Cargo Brings Rideshare Vending to More Markets
NEW YORK — Cargo, the New York-based startup that serves as an in-vehicle general store, is reaching new markets.
Described by CEO Jeffrey Cripe as a "mobile, on-the-go minibar inside the vehicle," Cargo currently services New York City and Boston, and has extended into the Chicago market, reported Inc.
"We see this massive passenger economy starting to emerge, where people will have more idle and downtime than ever inside a vehicle. And there's an opportunity to monetize those passengers, but do it in a way that helps them and improves their day," stated Cripe.
Cargo came on the scene last year. It was one of three companies selected as Ford Motor Co. 2016 Techstars Mobility startups. As part of the selection, Cargo received a three-month membership; $120,000 in funding; and guidance on business development, customer acquisition, developing relationships with the auto industry, and support from top business leaders, as CSNews Online previously reported.
Cargo is of specific interest to convenience store retailers, as it serves as an in-vehicle general store, helping ride-share drivers cater to passengers. It provides Cargo kits, sent directly to ride-share drivers who purchase them. These kits are stocked with products on-the-go passengers often desire, such as snacks, an energy drink, or Advil.
Each Cargo box is inscribed with the driver's unique code, so the driver can earn a commission on the sales. The per-item commission is 50 cents, with a $10 bonus after selling 10 items per week and a $50 bonus after selling 100 per month. Passengers are also given the opportunity to tip through Cargo, and drivers receive $20 for each new driver they refer.
According to a company spokesperson, "The top 30 percent of drivers sell about 500 items a month, and the majority make at least $100 a month on average."
Cargo makes money in two ways. The first is by buying products at wholesale prices and selling them to passengers at retail prices — essentially functioning as a rolling convenience store franchise, the news outlet reported.
The company also partners with brands that are interested in boosting particular products, or testing new ones in order to get customer feedback. Some brands currently partnering with Cargo for such research include Kellogg’s, Mars-Wrigley and BXBAR protein bars.
According to Cripe, he doesn’t think that companies like Uber and Lyft will want to add the logistics of a Cargo-type service to their business model, so cloning isn’t an issue.
"We have relationships with these companies," he added. "It's not like we're operating in a vacuum and they don't know who we are and we're sort of hoping they don't notice us. We've built Cargo from day one by soliciting the buy-in of executives and partnership directors at those companies."
Cripe also sees more in Cargo's future than the ability to sell snacks and sundries.
"What's really valuable about our company is our ability to distribute products directly to thousands and thousands of drivers across the country and eventually across the world," he said. "Essentially [we] have these mobile, connected, automatically replenished storefronts that can not only be retailers in-and-of themselves inside the vehicles that are connecting passengers with products — they can also be forward-located delivery vehicles," bringing products to customers instead of the other way around.