Blue Dart opens parcel locker to tackle etailers' sales rush

News Clip: www.dailynews.com

16 October, 2015

Blue Dart's Anil Khanna opens up on the steps his firm is taking to tackle the logistical nightmare that comes along with the festive season.

This is one of the busiest weeks for India's top etailers such as Flipkart, Snapdeal and Amazon. All of these etailers are eyeing manifold volume growth in sales through the ongoing Diwali festival rush by offering deep discounts across product categories. This volume surge obviously creates immense pressure on delivery partners to keep customers happy by delivering packages in time.

Last year, package deliveries were painful and customers vented their ire at many of the big etailers for delays and damage. Sudden volume surge poses a big challenge to delivery partners of these etailers - whether these are in-house logistics firms or express delivery partners. Anil Khanna, the managing director of Blue Dart, spoke to Firstpost about the challenges these sales festivals pose for his firm and how he plans to overcome them. The first innovation he spoke of was the launch of a parcel locker, the first such initiative by a logistics firm. This provides customers an option to pick up their parcels from a close-by locker instead of waiting for doorstep delivery. Blue Dart claims to hold 40 percent revenue share of the entire etailers' logistics market.

Excerpts:

How much of Blue Dart's business comes from etaliers

In 2010, etailing deliveries did not account for even one percent of our business but now, 25 percent contribution comes from this segment. We expect it to account for half our total business or even more in the next 4-5 years. Business from etailers has seen a CAGR of 87 percent for us in the last five years

Are you partnering one or two big etailers?

We cater to all. Every etailer has its own unique requirements which we try to fulfill. It is interesting to see that while Flikpart is reducing dependence on its in-house logistics firm, eKart, Snapdeal seems to be increasingly relaying on GoJavas where it has invested. Flipkart did 85 percent of all its deliveries through eKart last fiscal but has vowed to bring this percentage down to 65 percent this fiscal and further down to 50 percent by 2016-17. They were facing lots of challenges. Besides, logistics is not part of their core business. But Snapdeal prefers GoJavas so share of other express logistics firms like ours in their logistics business is coming down.

How much volume growth have the big eatiler promised logistics players like yourself?

They have been talking of three times the volumes they were doing in May-June this year for the October-November period. But I think it will not cross this number, it may in fact be between two-three times. I am saying this based on trends we saw last year.

Tell us about the parcel locker being launched today.

This is an alternate delivery method and the first such locker is coming up at Gurgaon. Here, customers can easily pick up shipments from the locker location instead of waiting for doorstep deliveries. Firms like ours face a lot of issues when delivery volumes increase exponentially during Diwali sales and other such sale periods. These include customer unavailable at home at the time of delivery, difficulty in locating exact address by the delivery boy, the address falling outside the delivery area etc. We anyway find it hard to rope in delivery boys. Such lockers will come in handy specially during sale periods when delivery volumes see a sudden jump.