GXO Logistics Acquires PFSweb to Expand E-commerce Fulfillment Operations

GXO Logistics, Inc. has announced its acquisition of e-commerce order fulfillment platform PFSweb for $181 million. The move is part of GXO’s strategy to expand its logistics footprint in North America and strengthen its operations in short cycle, high-volume product categories such as luxury goods and cosmetics.

The acquisition of PFSweb will provide GXO with valuable relationships with over 100 brands, including L’Oréal USA, Champion, and Kendra Scott. The contract logistics provider believes that the price paid for the acquisition is reasonable considering the current state of the online fulfillment market, which has slowed down after the peak of the pandemic.

GXO, based in Greenwich, Connecticut, generates most of its revenue from Europe. However, with the acquisition of PFSweb, which generates 86 percent of its revenue from North America, GXO will be able to strengthen its presence in the US market. PFSweb operates 11 fulfillment centers globally, and the company plans to open two more distribution centers in the US next year.

The acquisition will also expand GXO’s capabilities beyond outsourced warehousing and distribution. PFSweb brings three new support services to GXO: payments and fraud protection, customer care, and distributed order orchestration systems. These services will enhance GXO’s overall offering and provide additional value to its customers.

PFSweb employees will remain with the company and eventually be integrated into GXO. The transaction is expected to close in the fourth quarter of this year.

Overall, this acquisition is a strategic move for GXO as it seeks to expand its e-commerce fulfillment operations and strengthen its presence in North America. With PFSweb’s expertise and relationships with top brands, GXO is well-positioned to capitalize on the growing demand for fast and efficient order fulfillment in the e-commerce industry.

– E-commerce order fulfillment platform: A platform that handles the storage, packaging, and shipping of products ordered online.
– Contract logistics provider: A company that provides logistics services to businesses through contractual agreements.
– Short cycle, high-volume product categories: Product categories that involve frequent orders and high quantities, often seen in industries like fashion and beauty.
– Outsourced warehousing and distribution: The practice of using external companies for the storage and distribution of goods.

– Sourcing Journal: [source_article]
– University of Tennessee’s Global Supply Chain Institute: Dr. Tom Goldsby, professor and Haslam Chair of Logistics.