A freight consolidation service is set to make it easier for Kiwi food retailers to enter export markets and remove the need for intermediaries.

Start-up business Jetkrate will offer a small parcel, freight consolidation service which allows consumers to buy goods from Kiwi businesses and have them shipped to an Auckland address – where they are repacked and sent as one package to any offshore market.

The new service aims to replace the daigou (personal shopper) channel which uses personal shoppers to buy commodities from local retailers and ship them to customers in China as well as reduce the cost of freight for expat Kiwis living overseas.

Varun Khetrapal, Jetkrate co-founder, says the daigou channel is inefficient and lacks transparency.

“There are two major barriers to Asian consumers shopping directly here for products like Manuka honey, dairy, wine and woollen clothing.

“The first is not all NZ retailers ship overseas or if they do, the shipping costs become prohibitively expensive if customers are buying across multiple businesses.

“The new consolidation service removes the shipping barrier and makes it easier to get goods overseas once purchased – that allows the retailer to concentrate on building confidence levels across their customer base.”

Khetrapal says they plan to introduce a more formalised structured model, providing retailers with a clear route to this market which has a transparent and robust supply chain.

“The new model we operate under will bring retailers and consumers closer together and will allow them to see the pricing of the products they paid for from the retailer – a feature not common in the daigou channel.

Khetrapal, a former Fonterra executive says the idea for the new service took two years to develop and first came from watching tourists at the airport fill their suitcases with infant formula and milk powder.

“The concept isn’t right for a business like Fonterra which is a B2B marketing body but we believe it does have potential under a business-to-consumer model.”

He says the business is designed to support Kiwi businesses that are too small to deal with international fulfilment.

Khetrapal says their consolidated shipping model could save consumers two thirds of the costs of shipping items individually.