Scaling with logistics- Dream or nightmare?

Pooja Vishant | Sep 11, 2020

There is a lot of talk that goes on about the challenges faced in one of the key factors for e-commerce – Logistics. Although courier companies and logistics players have woken up to the fact that they need to buck up, the scene is not that rosy yet and there’s miles to go before they can catch up to the current pace of growth of Indian e-commerce.

However, what’s not changed even one bit, and probably may never will, is the condition of required infrastructure like roads and railways. As if the rough and inaccessible terrains across some parts of the country weren’t enough, never- repaired potholes and strict government regulations pose serious challenges to the Indian online retailers.

Going Beyond Tier-1 markets

Tier 2 and 3 cities are becoming favourites of online retailers with the increasing sales volumes from them translating into potential market segments for further expansion. But again, logistics is the challenge. Without compromising on customer service and product catalogue, etailers would have to spruce up their delivery networks to cater to the rising demand from these areas.

Let’s look at solutions that some major online players (who have resources to do so) have done identifying the significance of logistics in their race to scale up faster.

Snapdeal

“All courier companies will pick up from one location and ship to multiple locations. But not all will pick up from multiple locations,” said Kunal Bahl, CEO of Delhi-based Snapdeal.

So although Snapdeal relies on third party logistics partners to pick up products from 30,000 odd sellers from across the country, it made the following additions to its operational network:

  • Warehouses or fulfilment centres have been set up at various points in the country.
  • In May this year, Snapdeal Plus service was introduced using which sellers can store products at the 40 fulfilment centres spread out in 15 cities at additional costs.
  • Shipping time is reduced by as much as two hours in some centres.

Amazon

“Our fulfilment centres play a pivotal role in our distribution network,” said Amit Agarwal, vice president and country manager at Amazon India.

  • Main warehouses at Mumbai and Bangalore.
  • 20 delivery centres in these cities plus Chennai an Delhi to facilitate faster deliveries.

Flipkart

  • Seven warehouses in various cities which helps to facilitate next-day delivery to as many as 50 cities.
  • In house logistics eKart enables value added services next day delivery and scheduled delivery.
  • Efforts are underway to integrate systems with logistics partners also to tackle glitches like last minute offloads and weather disturbances.

Logistics companies are not far behind either ..

Spotting potential, logistic companies are also trying to spruce their operations to catch up. Some have set up specialised e-commerce fulfilment divisions and IT processes to cater to the requirements of online retailers. They cooperate with e-commerce companies to plan expansion of capacity and pincode reach according to demand.

Specialised service providers like Delhivery and Ecom Express have been helpful for online retailers. Delivery boys automatically translate into customer service executives of online retailers. Hence, they are dependent on them. These specialised firms help to ensure customer service standards to a certain extent.

  • Delivery boys collect cash from customers for cash on delivery purchases.
  • Now etailers want delivery boys to verify value of product using tech enabled mobile devices in the case of product returns/exchanges.
  • Delivery team handles installation of appliances like refrigerators and washing machines.
  • Etailers would like them to start handling customer queries too.

Logistics companies have started training their delivery boys and staff with the required IT and technical knowledge to handle the above requirements.

A little more help from government wouldn’t hurt ..

Maybe repairing the potholes or relaxing government regulations need time. But government could help by activating services likeIndia Post , which has a network covering all pincodes in the country.

Currently, a lot of shipments are done through commercial airlines, especially large appliances. But it is much costlier than surface transportation and also packages get bumped off very often to accommodate passengers and cargo.

What can an Indian Online Seller do to ensure fast and safe delivery to customers?

Although major players like Snapdeal and Flipkart lean on India Post sometimes for deliveries, the extent or success of it is not know. Individually, a private company may not be able to match up to India Post’s network, but could use help from them to match demand for online shopping throughout the country.

As a marketplace seller, you can bank on the logistic improvements of marketplaces by utilising their warehouse facilities and shipping services to reduce your shipping time.

As an individual seller, you could utilise the services of specialised e-commerce service providers like Delhivery and Ecom Express to ensure speedy delivery to your customers.


About Author

Pooja Vishant

Pooja Vishant

After dwindling with her family business, into travel and hospitality, for more than 3 years, Pooja Vishant found her true love in writing. Happy-go-lucky and cheerful, she loves pink; so pink is the way to go if you want to get into her good books. The Associate Editor keeps track of even a leaf that has moved in the ecommerce world!


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