Logistic is seen as a low-talent industry

Delhivery is a niche logistics provider that only caters to e-commerce clients. Sahil Barua, CEO, Delhivery, highlights his corporate strategy to beat the competition.

What is your assessment on Indian logistics industry? How it is evolved in the last 10 years?

So far, Logistic Service Providers (LSP) in India have evolved around specific models like retail courier operators or as large B2B logistics players. Most of the evolution has been around specific verticals or specific capabilities. For instance, Blue Dart Express is the only domestic LSP (logistics with an aviation business for express cargo), ColdEx specialises in cold-chain logistics, players like Safexpress and Gati are in road transportation and Quantium has a clear leadership in the mail-room space.

Do you think present size of logistics industry is capable to cater to the needs of e-commerce industry?

Estimates put the e-commerce market in India at about Rs 6,000-7,000 crore. This market will grow at least six-eight times by 2016. As things stand, we expect only a few of the major LSPs like Blue Dart and ourselves to be able to tap into the demands of this burgeoning sector. Only players whose focus is always on clearly understanding customer requirements, maintaining the tightest service level agreements, ensuring fastest turnaround and with a willingness to invest in technology to adapt to changing e-commerce needs will succeed.

What challenges does the logistics industry face in India? Likewise, do you think there is any scope for improvement in the retail industry so that better logistics services can be provided?

The biggest challenge we face today is that logistics is a fairly unorganised space and is still viewed in India as a low-talent industry. Regulations also continue to remain a challenge – especially inter-state transportation and taxation regulations.

The third barrier is the systematic under-investment in technology from LSPs as well as their clients. Today we face situations where we are unable to work with certain clients or partner with certain LSPs because of the fact that our technology far outstrips the legacy systems that are still in use at their end.

Tell something about your retail clients. What type of services you are providing for them?

Delhivery helps merchants and brands create successful online businesses through e-commerce services and core logistics. Our proprietary commerce technology toolkit provides sellers a way to develop and manage their entire online channel, including setting up a web-store and order management system, catalogue management, studio services, integration with marketplaces, managing payments, SEO/SEM, selling on social media platforms, user verification, fraud detection and inventory management. Our IT is built in-house and is completely customised to the unique needs of each of our clients.

What are the major challenges to serve retail clients?

The major challenge in working with retail clients is maintaining the highest levels of service constantly and ensuring the consumer experience remains consistent. For several retail clients, we overcome the challenge by providing them the technology that allows them to schedule and manage logistics with us and for them as well as their customers to track orders and consignments on a real-time basis.

What are your growth plans for next two years?

We will be expanding our fulfilment and express logistics capabilities significantly in the next two years. Broadly put, we are looking at a network of at least 15-20 mega-fulfilment centres and express logistics services in over 200 cities with self-owned line haul as well.