How Madison Reed Improved Direct-to-Consumer Parcel Delivery with OSM Worldwide

Madison Reed products shipped using OSM's 3PL partner services

What We Achieved: 

    • Simplified Madison Reed’s supply chain with our premium shipping service. Our USPS partnership provided more consistency in costs and time in transit.
    • Created more efficient and accurate delivery with state-of-the-art parcel-sorting automation.

Overview of Madison Reed

Madison Reed is a prestigious beauty brand that has revolutionized the hair color industry. Founded in 2013 by Amy Errett, the company was built on the belief that salon-quality hair color should be convenient, affordable and made with clean ingredients. What started as a direct-to-consumer (DTC) business has quickly become an omnichannel brand with over 90 hair color bars and wholesale partnerships with retailers like Ulta Beauty, Target, Walmart and Amazon.

Brand’s Fast Growth Creates a Complex Supply Chain 

During Madison Reed’s first decade in business, its explosive growth led to a complex, multinode supply chain with inventory in several locations nationwide. The company relied on one parcel carrier for the majority of its DTC business.

Madison Reed used two of the carrier’s service levels—ground service, which promised delivery within three to six business days and expedited service, for which the company paid a premium. Complex shipping rules around which level to use, coupled with free shipping to subscription members, made cost control a priority.

But there were some performance issues. “We saw many people who wouldn’t get their product for 10 days, even if we upgraded and paid more for the expedited service,” said Terry Baughman, Madison Reed’s director of fulfillment and logistics.

The company urgently needed to streamline its supply chain to reduce costs and provide better customer service. “I need a network with a cost-effective, reliable service,” Baughman said.

Madison Reed Chose OSM Worldwide Over Other Carriers 

In 2023, Madison Reed chose a new third-party logistics (3PL) company to centralize inventory at a primary distribution center in Fort Worth, Texas. With the new 3PL and distribution center, Madison Reed sought alternatives to challenge its current carrier and requested shipping partner proposals for its DTC business. After a competitive analysis that included the incumbent, Madison Reed chose OSM Worldwide.

Baughman said OSM offered key advantages over competitors:

    • OSM offers one ground service that promises delivery within two to five business days. “What really put OSM over the top was the simplicity of their service and it’s a premium service,” Baughman said. “We had that comfort level with their operations and the pricing was very competitive.”
    • OSM’s carrier hubs are strategically placed across the nation, a network design that enables the company to provide predictable delivery to drive down shipping costs and partner in clients’ growth. Because of OSM’s processing locations, Madison Reed’s packages can move more quickly to their final destinations.
    • OSM specializes in handling domestic parcels shipping from under a pound up to six pounds. Ninety-five percent of Madison Reed’s orders are under two pounds, so its parcels fit perfectly into OSM’s Premium Network® for optimal rates and time in transit.
    • OSM embraces a performance culture that helps clients move their business forward. The company is consistently updating and improving automation processes to increase accuracy and traceability. After touring OSM’s Dallas hub, Baughman said, “I could tell that money was being invested into automation, throughput and efficiency. I really liked that.”

Madison Reed Appreciates Open Communication, Flexibility

Madison Reed quickly realized the benefits of partnering with OSM. OSM processes the company’s packages the same day they are picked up and begins transporting them as quickly as possible.

Additionally, Baughman noticed OSM’s communications are excellent. When a product is damaged, OSM immediately sends pictures so Madison Reed can ship a replacement. With the previous carrier, the company sometimes never knew about damaged products.

OSM was transparent when the U.S. Post Office, which handles last-mile delivery for OSM, unexpectedly changed freight rules that affected Madison Reed’s shipping costs. “OSM has been flexible in working with us on rates for different-sized parcels,” Baughman said. “We are grateful for the partnership.”

OSM also has met its promised target for time in transit. “What my team likes the most is that there’s one premium service with OSM,” Baughman said. “Our shipping rules don’t have to be complex and we don’t have to worry whether we upgraded the service correctly.”

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Interested in learning more? Read this case study about how our premium fulfillment solutions helped ensure greater shipping affordability and speed for wellness and beauty eCommerce company Dr. Squatch.