Online marketplaces partner with India Post to ensure faster deliveries

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Amazon meets Minister

This Tuesday, Amit Agarwal, AVP and Country Manager, Amazon India and Monique Mache, VP (Global Public Policy), Amazon met with Ravi Shankar Prasad, IT and Communications minister. Amazon hopes to reduce its delivery time to under 24 hours by partnering with India Post, and also seeks to deliver to tier-2 cities and beyond with their help.

The government has asked Amazon to submit a detailed proposal which it will respond to. On a lighter note, Prasad referred to Amazon’s arch-rival Flipkart during the meet, and asked Agarwal who would win the e-commerce war between the two majors in India. “The consumer,” Agarwal responded.

Who else is partnering with India Post

On 14th October this year, which was incidentally Business Development Day, the department of postal services decided to join hands with Snapdeal and ShopClues to cater to their logistics needs with its wide reach. In return, for getting their support for an INR 4909 crore IT project, to bring in electronic connectivity and capability across 1.5 lakhs Post Offices for enhanced delivery of all mail & financial services.

Sanjay Sethi, CEO & Co-Founder, ShopClues said, “We’re a marketplace for the masses and nearly 65% of our customers and merchants are based in the non-metros or tier 2/3 towns. With the widest delivery network in the country, India Post will definitely be a significant partner in our logistics operations. On a peak day, ShopClues services over 85,000 orders and with this tie-up, we expect to improve our offering for customers across 25,000 pin codes.”

Further, this Thursday is when Sachin bansal, Co-founder and CEO, Flipkart, is scheduled to meet with the minister. The agenda of the meeting is a likely tie-up to deliver goods via the India Post network.

Why India Post

Prasad had said in statement two months back that India Post is best suited for e-commerce delivery services. The postal department can be reinvigorated by associating it with the fast growing ecommerce industry. India Post is the world’s largest postal network with over 1.55 lakh post offices, 89% of which are in rural areas. Prasad is of the view that this move, coupled with incentives for timely deliveries, may help make postmen more efficient. “The postmen are expected to get some reward for timely delivery of products, although it’s just an idea as of now,” said a source. India Post has also revamped its offering, and it now includes Cash on Delivery services, which is a key requirement for e-commerce in India.

In October, Prime Minister Narendra Modi had constituted a special task force, headed by former cabinet secretary TSR Subramnian, to enhance the role of India Post in financial trade. India Post, which is hoping to become a payment bank that can handle deposits and remittances but not loans, had earlier tried to get a banking licence but failed. This endeavor may prove successful since most major e-commerce companies are interested in partnering with the department of posts mainly because of its unparalleled rural reach.

What we are wondering

The first e-commerce company to partner with a government postal agency was Alibaba in China, where it tied up with China Post to share warehouses, processing centers and delivery resources, thus providing quick and simple delivery services in the country. Ecommerce players in India may have taken a cue from this successful partnership.

We are glad to see India Post being revived – it makes us hope that maybe the world will start sending handwritten letters instead of texts every once in a while.

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