October 28, 2020: Gurugram-based logistics start-up Pidge witnessed a rapid growth from business to consumer and D2C brands (Direct to Consumers). Pidge was able to provide safe, secure and consistent service to all its customers who were confined to their homes during the lockdown. During the initial weeks of its formation, the company had 50,000 orders, but Pidge completed the next 50,000 orders in just six weeks following that, and the next 1,00,000 were also completed in the following six weeks. As the logistics sector witnesses a rebound, many logistics companies, especially start-ups, are witnessing growth opportunities.
Pidge now plans to expand to Jaipur and Ahmedabad and later to south India soon.
“With the onset of the festive season, we are expecting a surge in demand by 25 times by the end of this year. With the increased demand, we are also looking to add to our delivery staff and to have around 1,500 delivery executives by the end of this year,” Ratnesh Verma, founder and leader, Pidge, told THE WEEK.
Ecom Express, another Gurugram-based logistics firm, also witnessed growth and is planning to expand its reach to 27,000 plus pincodes. The company is also adding new facility centres and warehousing spaces. “COVID-19 has catalyzed the growth of the e-commerce industry. Being a tailgating industry, we have also seen a positive effect in our business. This has been a phenomenal year for us. Our entire focus now is on sustaining the momentum that we have generated so far by leveraging technology and talent,” said a spokesperson from Ecom Express.
With the pandemic on its downward trend and commercial activity on an upward trend in India, road transportation industry growth is a direct consequence. “The experiences through the recent pandemic have made the logistics service buyers very choosy on their service providers, as they consolidate their business with the organised sector supplier base that is technology enabled. From a level that was 30 per cent below the pre-pandemic level in August end, we are expecting to have a 150 per cent growth by March 2020,” remarked Anjani Mandal, CEO, Fortigo Logistics.
Interestingly, when compared to the initial stages of the lockdown, there has been a rebound in the logistics segment. A recent report by Dun and Bradstreet during the initial lockdown of 52 days, the daily movement of trucks in India was less than 10 per cent of the normal levels and from April to July 2020, the Indian railways freight revenue was down 26.4 (year-on year) and in terms of volume, it was down by 17 per cent. The shipping segment had also declined and the total traffic (containers, POL etc.) at the major ports had declined by 16 per cent for the period of April to August 2020 when compared to the same period of last year.
The report says the logistic companies that cater to e-commerce firms will see traction as online purchase of essential and non-essential commodities have increased. The report further elaborates that the demand will be driven by e-commerce and third party logistic players as cost pressures would lead to increase in outsourcing activities.
The Dun and Bradstreet report also highlights that the high probability of relocation of global supply chains to India and post lockdown increase in domestic demand would drive the demand for warehousing and logistics. The report states that as the last mile usually constitutes around 30 per cent of the total logistics cost, companies will have to come up with innovative ways for optimising cost for the contactless last mile delivery solutions. There would also be cost pressures in terms of ensuring safe and hygienic delivery of goods. The report, however, points out that smaller logistics players will find it difficult to invest in new-age technologies such as cloud, AI, and automation which will help them in improving their operational efficiency.
“Logistics for e-commerce has come back roaring during the festive season and we are experiencing strong growth. Strongest opportunities lie in enabling offline retailers to participate in the digital economy by providing turnkey solutions for fulfillment and customer experience. While many companies focus on demand generation, very few companies are helping these new sellers excel in the post order fulfillment and deliver a stellar customer experience,” observed Saahil Goel, CEO and co-founder of Shiprocket.
Source: The Week
