The future of the Indian Logistics Market

The future of the Indian Logistics Market

The Indian logistics market has experienced parabolic growth in the last decade due to the e-retail boom in the country. There was a time when logistics were an expensive affair with severe bottlenecks in the system and not much was being done to try and improve upon it. The lack of action in e-commerce also meant that not much was happening in the logistics space. All of this changed at the turn of the decade when several factors like the growth of internet penetration, rise of social media and the entry of global VC money into the Indian startup ecosystem 

When the likes of Sachin Bansal, Kunal Bhal, Praveen Sinha and co. were revolutionizing the e-retail space, a demand for logistics companies which could challenge the traditional players and offer a more well rounded solution to the e-commerce players, was emerging. This opportunity gave rise to many players such as Delhivery, Xpressbees, GoJavas, Quickdel, E-Com Express etc. 

These new-age logistics startups were primarily tech driven and implemented the latest innovations in the supply chain to stay ahead of the game allowing them to become the preferred delivery partners for the e-retail players. The traditional players in the market just couldn’t keep up with the pricing and service modules of these players and ended up losing a lot of ground to these emerging logistics companies. Setup in 2011, Delhivery went on to become India’s first unicorn in the  logistics tech space rising to a valuation of $1.5 Billion last year culminating in them winning the Startup of the Year award in 2019. 

“The world logistics industry is set to emerge as one of the biggest sectors in the global economy by the year 2030. We are already seeing a massive boom in hyper-local delivery and health-tech sectors driven by the adoption of technology, new age practices and the unforeseen after effects of the pandemic. At Swiggy, we are now utilizing our highly capable fleet not just for food delivery, but also for groceries and parcel deliveries within the city” – said Markand Vyas an Area Manager (East) at Swiggy and ex-Delhivery product manager. 

Recently, Bengaluru based Shopx has entered into an agreement with aerospace and robotics firm, Omnipresent to start trials for their drone delivery system called ‘Air Train’, which aims to bridge the logistics gap from the warehouses to retail outlets seamlessly. Shopx and Omnipresent have already secured the permissions to carry out drone deliveries and they aim to start the trials by the 1st of September, 2020. Speaking on the development, ShopX’s CEO said, “With our partnership with Omnipresent, we want to put India at the forefront of utilizing drone tech for real applications today and intend to create a major disruption in the supply chain especially for the retail segment”. Aiming to go fully environment friendly by 2030, Flipkart has started a pilot project under which they are using only electric vehicles (EVs) for logistics. They plan to fully rely on EVs for deliveries by 2030 and have identified the need to build charging infrastructure near their network of 1400 supply chain hubs, to achieve this goal. Adoption of cutting edge technology to cut costs and sustainable, environmental practices look set to be the catalysts that will drive the next era in the industry.

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