UK startup Shutl, which just came out of private beta, aims to shake up one of the most static parts of the e-commerce sector; delivery. A Royal Mail survey from 2009 measured the reasons buyers abandon an online shopping transaction, and two thirds of those surveyed cited delivery convenience or cost. Shutl addresses both of those problems by linking local couriers to retailers to speed up delivery.

The Shutl Now service guarantees delivery within 90 minutes. With Shutl Later you choose a one-hour delivery window. One of the interesting things about Shutl is that it seems to be the first company worldwide implementing such a service.

Delivery couriers are regional businesses that handle deliveries between businesses only. They don’t deal with consumers directly or with big retailers, but they can be very cost effective for short journeys. Retailers tend to use mail or global delivery companies like UPC. Shutl allows a courier company to define when and where it has vehicles available and at what prices. When a consumer orders one or more products online that are deliverable using Shutl couriers, Shutl is added as a delivery option. The retailer then sends an API call to Shutl that details the weight and dimensions of the items and the store address.

Shutl then automatically gathers quotes from the relevant couriers and combines those with rating data (calculated from tracking previous deliveries) to select the best quote based on price and quality. A call is then made to the courier’s order management system. For the courier company, this delivery looks the same as any other. The system also allows couriers to offer discounted deliveries during slack periods or when there is spare capacity.

Shutl’s first client was a high-end retailer in London called Start. On sales where Shutl delivery was offered, conversion (i.e. the number of buyers who completed the transaction) was 20-30%, considerably higher than transactions completed without Shutl delivery. A second client, announced today, is wine merchant Laithwaithes, which only allows purchase in-store but will now deliver via Shutl. In general though, the sweet spot for Shutl is retailers who have brick and mortar as well as online shops and sell goods that are too large and heavy to deliver by mail. The company also announced today that it is opening up its retailer and courier APIs.

Shutl currently only operates in London but already has courier partnerships in place for the rest of the UK. The company was established in June 2008, has 20 employees and a 500K investment from Big Bang Ventures.

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