Amazon unveiled its plans to establish a new fulfillment center in Caledonia in May, but even with the arrival of the nationally recognized e-commerce giant to West Michigan, two brothers are carving out their own market demand in the warehousing and fulfillment business.
Seeing a need for a fulfillment center in Kentwood, Kris and Kurt Rewa launched Warehousing and Fulfillment USA in 2012. The business started with only the two of them in a 2,000-square-foot warehouse, but sharing almost 20 years of shipping and logistics experience, the two brothers grew the company in a short amount of time.
Now, they are looking at a 12-person staff in an almost 50,000-square-foot facility at 5357 52nd St. SE and fulfilling just over 100,000 orders every year and closing on about $3 million in sales.
“It has grown tremendously,” Kris Rewa said. “We basically doubled every year since we started it.”
Even with Amazon setting up shop within a couple miles of their operation, Kris Rewa said they don’t view the e-commerce giant as a competitor, explaining the services they provide are much different.
“Amazon, while they do fulfillment, their core business is, ‘Go to this website, buy 20 products from 20 different sellers, we’ll put them all in one box and ship them to your house,’” he said. “Our core business is working with the business owners and sending their products specifically to the client.”
On the fulfillment side, WAFUSA services six to 12 clients per year in West Michigan, including final-mile delivery service for major retailers like Home Depot, Walmart and Target.
“If you buy something off of their website that’s oversized and won’t ship FedEx or UPS — couches, kayaks, lawnmowers — they ship it to us, and then our trucks run around the city and drop them off,” Kris Rewa said.
Brent Velting, WAFUSA vice president of business development, said the company was able to grow quickly because it noticed a high demand for third-party fulfillment in West Michigan and, particularly, in Grand Rapids.
“There are definitely fulfillment centers in and around (West Michigan),” Velting said. “But it was somewhat underserved in Grand Rapids. Especially with Amazon coming in now, I think people are just now realizing it is an option to get a third party.”
One of WAFUSA’s bigger clients is Duke Cannon Supply Company, a dealer of men’s grooming products. Kurt Rewa said, because his company handles fulfillment, the client is free to manage other aspects of the business.
“The advantage for them is they can focus on growing their business,” he said. “They don’t have to worry about actually fulfilling the orders and being bogged down with managing the warehouse staff and logistics side of it.”
Rewa said another niche service that distinguishes WAFUSA from Amazon is custom kitting. A client like Duke Cannon may send a large bundle of its products to WAFUSA’s warehouse to have them assembled into display kits for retailers or subscription boxes for consumers.
Velting said once WAFUSA clients attain a certain growth level, they get their own individual representative at the warehouse, affording them access to the warehouse and person-to-person customer relations.
“You don’t have to go through all the automation and red tape,” he said. “So, we pride ourselves on being available.”
Because WAFUSA is a smaller company serving small to medium-sized businesses, it also is able to provide warehousing and fulfillment at a lower rate than Amazon.
The Rewas said they hope WAFUSA is able to ride the wave of Amazon’s success. Considering clients have the option to use the Amazon marketplace without Amazon fulfillment, they can fulfill through a third party, like WAFUSA, for a lower rate.
“We have (fulfilled for Amazon) in the past for some clients,” Kris Rewa said. “So, when it says ‘fulfilled by Amazon,’ there are times where it is fulfilled by Amazon, but it’s coming through a third party.”
Kris Rewa added he is hoping to finalize a contract with Amazon for final-mile service once the company establishes its new Caledonia warehouse.
“I think we have a really good shot at it, just based on some of the other ones we’ve been able to put in place locally,” he said.
Velting said WAFUSA has had great relationships with larger third-party logistics companies, like Columbian Logistics Network in Grandville, and the two will recommend clients to each other based on what type of service they need.
“Essentially, we just do very different distribution,” Velting said. “We’re absolutely open to growing in whatever way possible.”