Etailers Scramble To Fix Their Logistics

Logistics has been a perennial challenge for all e-commerce companies, including leading e-commerce player Myntra. With its growing customer base, managing the demand had become increasingly difficult even with a large fleet of delivery boys. Especially as it struggled with accurate location mapping; it lost over 10 per cent of the delivery time in customers’ location search, which reduced the efficiency of its delivery model.

Recently, it partnered with LogiNext Solutions for enhanced real-time tracking, visibility and alerts. Following the association in September this year, Myntra has been able to save costs, reduce the distance travelled and improve the estimated time of arrival and departure with dynamic route optimisation.

With LogiNext, Myntra is finally able to track its inter-city shipments accurately and share real-time movement alerts with customers.

Earlier this year, Myntra’s parent company Flipkart threw open its logistics services eKart to third-party e-commerce firms including Paytm. eKart, which operates as an independent entity now, has recently commenced customer-to-customer (C2C) courier option to cater to the high demand in such logistic services.

Last year, global rival Amazon set up a logistics company in India known as Amazon Transportation Services, to deliver products directly to consumers. The e-commerce giant also has its Easy Ship delivery service, under which Amazon undertakes delivery when an order is placed.

Snapdeal, which didn’t have its own logistics unit until it acquired a stake in Gojavas in 2015, has now created Vulcan Express, an in-house logistics and delivery unit. In fact, according to a survey by RedSeer Consulting, Snapdeal had the fastest deliveries at the start of the year (January - March 2016), while Amazon was in the lead in the next quarter (April - June). In the latest quarter, however, Snapdeal regained its number one position.

Commenting on the findings of the report, Anil Kumar, CEO, RedSeer Consulting says, “With the shift in focus from GMV growth to overall customer experience enhancement, delivery speed has become one of the key metrics to gauge the performance of e-tailers. Aggressive investments by e-tailers in creating a robust warehousing and logistics infrastructure are likely to pay rich dividends.”

Presently, the country’s logistics industry is pegged at $300 billion. It is estimated to grow at a CAGR of 12.2 per cent by 2020.

Logistics has clearly emerged as a critical focus area for all e-commerce companies as speed of delivery is as important as the product quality for a customer. In fact, smart logistics can indeed be the big differentiator among e-commerce companies, which makes it important that they go the extra mile to win the game of speed and efficiency.