The collapse of Huboo Technologies Limited (now Hub Realisations Limited Company number 09727464) forced numerous eCommerce businesses to search for alternative fulfillment providers. This situation reveals a fundamental problem regarding the practice of online retailers using unproven fulfillment startups without proper financial verification.
Why eCommerce Businesses Take the Risk
Fulfilment Startups Offer Lower Prices
The affordable pricing structure of Huboo attracted numerous small businesses who sought budget-friendly fulfillment solutions.
The financial stability of these companies typically suffers when they provide low-cost services.
Lack of Transparency in the Industry
The majority of fulfillment providers maintain secrecy about their financial difficulties until their situation becomes unmanageable.
Businesses operating in eCommerce do not consistently verify the financial stability of their providers before making a selection.
The Pressure to Compete with Amazon
The quick delivery services of Amazon drive smaller retailers to search for scalable logistics solutions.
The competitive benefits offered by Huboo and similar companies come with unknown expenses to their customers.
Switching Fulfilment Providers Is Difficult
The process of moving stock between providers proves both costly and time-consuming.
Many businesses maintained their partnership with Huboo even when warning signs appeared because they wanted to prevent service interruptions.
How eCommerce Businesses Can Protect Themselves
Research financial reports before choosing a fulfilment provider.
Businesses should implement multiple logistics solutions to prevent their operations from becoming dependent on a single company.
Establish a backup strategy which will activate when your current provider suddenly ceases operations.
Conclusion
The collapse of Huboo Technologies Limited served as a crucial lesson for businesses operating in eCommerce. The lack of proper financial evaluation by retailers creates a high risk for future fulfillment breakdowns across their industry.
