The Logistics Industry Has Some of the Best Startups in India Vying for Market Share
The logistics industry in India offers tremendous scope for growth as it is already a well-entrenched industry although not seamless and is confined to various sub-segments of the niche. Looked at from another perspective, this is not an entirely bad situation for balanced growth of the industry as it is likely to prevent oligopolies from casting their shadow over the industry. As in many other industries, the logistics industry is also experiencing the arrival of some of the best startups in India that are equipped with quality resources in terms of technology, manpower and capital than most courier businesses.
The logistics industry needs to evolve much more
There is a perception in some quarters that the logistics industry in India is still languishing in a bygone era with ramshackle infrastructure and very little institutional investment. Consequently there hasn’t been any growth of home-grown courier companies in India bankrolled by organized institutional funds. As a result, the courier and package delivery segment of the logistics market has largely remained confined to a few large companies on one side and tiny labour-intensive one-man shows on another side with no mid-sized firms to bridge the gap and strike balance.
This gap is now being plugged by the best logistics start-ups in India, funded by agencies who know where and how to put their money and make sure it bears fruit. It will still take some time for this segment of the market to mature and have service providers who are able to ensure quality deliveries especially in the last mile. As a labour-intensive business operating in a niche where even the rules need to be updated and simplified for easier adherence, the operating margins are quite low.
More organized players in the niche will raise quality
With the last mile delivery services almost entirely handled by the small labour-intensive firms the service quality has enormous scope of improvement. These small courier firms can’t afford the additional cost of streamlining such services to make a difference in last mile services. The other problem is that the premium pricing for these services is getting difficult as customers have cheaper options that deliver more or less the same quality. As the ecommerce boom surges ahead, these small firms find themselves in direct competition with the best start-ups in India.
These new courier firms are entering the market to cater to the last mile delivery segment at affordable cost. As they raise quality benchmarks and scale up operations with funds, technology and trained management, the smaller players that refuse to make the necessary adjustments, will slowly become redundant. It is expected that ecommerce will attract the bulk of the last mile services as most online retailers have to offer free shipping in a market that still insists on cash-on-delivery which in turn, has pushed up rejections as customers find excuses.
Parsel is a startup logistics firm with innovative new services like on demand and instant deliveries and it is already carving a major niche for itself in the logistics market.
About Author
I am Rajni Singh and I love researching and writing about developing technologies. I have always enjoyed writing about tech stuff and now that I am doing it professionally, it’s even more satisfying. I contribute regularly to blogs related to technology.
The logistics industry needs to evolve much more
There is a perception in some quarters that the logistics industry in India is still languishing in a bygone era with ramshackle infrastructure and very little institutional investment. Consequently there hasn’t been any growth of home-grown courier companies in India bankrolled by organized institutional funds. As a result, the courier and package delivery segment of the logistics market has largely remained confined to a few large companies on one side and tiny labour-intensive one-man shows on another side with no mid-sized firms to bridge the gap and strike balance.
This gap is now being plugged by the best logistics start-ups in India, funded by agencies who know where and how to put their money and make sure it bears fruit. It will still take some time for this segment of the market to mature and have service providers who are able to ensure quality deliveries especially in the last mile. As a labour-intensive business operating in a niche where even the rules need to be updated and simplified for easier adherence, the operating margins are quite low.
More organized players in the niche will raise quality
With the last mile delivery services almost entirely handled by the small labour-intensive firms the service quality has enormous scope of improvement. These small courier firms can’t afford the additional cost of streamlining such services to make a difference in last mile services. The other problem is that the premium pricing for these services is getting difficult as customers have cheaper options that deliver more or less the same quality. As the ecommerce boom surges ahead, these small firms find themselves in direct competition with the best start-ups in India.
These new courier firms are entering the market to cater to the last mile delivery segment at affordable cost. As they raise quality benchmarks and scale up operations with funds, technology and trained management, the smaller players that refuse to make the necessary adjustments, will slowly become redundant. It is expected that ecommerce will attract the bulk of the last mile services as most online retailers have to offer free shipping in a market that still insists on cash-on-delivery which in turn, has pushed up rejections as customers find excuses.
Parsel is a startup logistics firm with innovative new services like on demand and instant deliveries and it is already carving a major niche for itself in the logistics market.
About Author
I am Rajni Singh and I love researching and writing about developing technologies. I have always enjoyed writing about tech stuff and now that I am doing it professionally, it’s even more satisfying. I contribute regularly to blogs related to technology.
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