New York’s local businesses were hit hard by the pandemic, so one Israeli immigrant, now a Brooklyn resident, created an online marketplace to bring life back to the city’s struggling stores.
When Covid-19 hit the United States last year, Maya Komerov saw shoppers flock to Amazon (AMZN) at the expense of the small businesses in their neighborhoods. So she used her background in tech and previous experience working with local shop owners to build ShopIN.NYC, an e-commerce platform for local shopping in New York City.
How it began
ShopIN.NYC is the newest iteration of Cinch Wallet, a company Komerov founded in 2017 to drive shoppers to local stores where they could get personalized discounts and offers through the Cinch Wallet app.
But once the pandemic hit, Komerov focused on restructuring her business strategy. “When Covid started, we couldn’t send people to the stores,” she said. “Stores told us they couldn’t compete with Amazon even if they had e-commerce.”
So Komerov transformed Cinch Wallet into ShopIN.NYC, an online marketplace that connects with nearly 100 local shops in Brooklyn and Manhattan, aggregating goods for same-day delivery to New Yorkers.
Shifting consumer habits
In an era filled with online shopping and reliance on quick delivery times, big retailers such as Amazon and Walmart rule the e-commerce world. Komerov is trying to break consumer habits and shift the focus back to neighborhood shopping. “We need to bring back the power to the local businesses,” Komerov told CNN Business.
About 100 people use the platform every day, and the average ShopIN.NYC user buys goods from three stores with an order that comes to about $70 on average, Komerov said. Shoppers pay a delivery fee if the order is below $60, and the platform isn’t subscriber-based — anyone can use it to purchase goods from local stores. When it comes to adding new inventory to the site, Komerov said the team adds about 5,000 new product SKUs every week.
Once an order is placed, the store prepares the purchase and a ShopIN.NYC employee picks it up based on pre-set routes throughout the city. The items are then taken to a sorting area in Brooklyn and prepped for delivery by ShopIN.NYC staffers.
Orders placed before 10 am will arrive the same day between 4:30 pm and 9 pm. Later orders arrive the next day.
Each business owner decides how much they are willing to pay Komerov for the service. Most pay around 10% and the platform allows shop owners to change the prices of their items to increase revenue for the businesses. “The store can decide how much they can pay to make sure that they don’t lose money,” Komerov said, offsetting a common pain point for small businesses that use delivery platforms like Uber Eats and Seamless.
And while some businesses charge the same price for their products on ShopIN.NYC, others upcharge for the service, but that decision is up to each business owner.
Small businesses ‘fighting for their lives’
Sahadi’s Fine Foods opened in Brooklyn in 1948, and the store’s managing director, Ron Sahadi, is one of the nearly 100 business owners who sell products on the ShopIN.NYC platform.
“Small businesses are really fighting for their lives these days,” he said. ShopIN.NYC “reaches people that might not have otherwise thought of ordering from some of the local shops.”
The big companies that are dominating e-commerce make it easy to order from them, Sahadi pointed out. And ShopIN is trying to do the same for smaller businesses.
But he emphasized that it’s important for consumers to practice what they preach. “Don’t tell everyone to shop small and then go off yourself and order everything from Amazon,” Sahadi said.
ShopIN.NYC joins a growing list of companies working to find creative ways to support the e-commerce side of local businesses.
For example, some independent food shops work with Mercato, a grocery store delivery service, which charges a 9% commission on every sale along with a 3% credit card transaction fee.
But ShopIN’s experimentation with the set-your-own fee model sets it apart.
The sustainability benefit
Waste is a huge byproduct of the e-commerce world. Online purchases produce huge amounts packaging waste, and online items tend to come from different distribution centers, increasing delivery mileage and boosting carbon emissions. Amazon packages, for instance, include the box that the goods are sold in, plus bubble wrap, plastic and other packaging materials to protect the items inside the larger shipping box.
“We really focus on sustainability,” Komerov said of her business strategy, adding that the company uses only paper and minimizes packaging for every delivery.
Gearing up for growth
Komerov plans to increase the number of stores the platform works with to 300 by the end of the year. “Our goal is to bring back 20% of online sales to New York City,” she said. And she intends to make local shopping part of New Yorkers’ daily lives and routines.
Komerov is seeing between 20% and 30% revenue growth month-over-month and plans to expand to other cities after the company “builds a strong playbook” in New York. She’s also developing an app for the platform.
Shopping locally in lieu of shopping on Amazon is “a movement that that’s not going to go away,” Katerina Bogatireva, owner of Brooklyn’s first package-free, zero waste grocery store, told CNN Business. “Of course it’s convenient,” Bogatireva said of shopping on Amazon. “But if there’s an alternative that’s almost or just as convenient, at some point, I think it’s it’s a no-brainer.”