Business Growth Plan Delhivery – Branding Solutions is a media arm that combines the power of creativity and editorial power to create compelling stories for the brands that work with it.
Transport players Delhivery claim to have built a nationwide presence through 18,454 pin codes that allow the brand to go anywhere.
Business Growth Plan Delhivery
As in-store retail sales plummeted during the pandemic (2020-2021) and encouraged consumers to shop online for convenience and security, there was a big shift towards direct customers. (D2C) Model – Sales involving wholesalers or distributors.
Ai In Logistics: Supply Chain Ai Startups, Challenges & Use Cases
The D2C market in India is valued at USD 50.8 billion by 2022 and is estimated to reach over USD 300 billion by 2030, growing at a CAGR of 24%.
The outbreak is now on the wane, but industry insiders think the D2C brand will be business as usual. Market data supports this. According to the report, the D2C brand saw a 39% year-over-year increase in total sales between FY20 and FY21.
Although the epidemic drove digital brands for the first time, building their own supply chain is a useful task for many modern brands. On the other hand, legacy players and deep markets with strong distribution networks can quickly expand across urban and rural India to capture more market share.
However, it is the cost (logistics) that is squeezing the D2C brand at this point. The D2C brand goes beyond FMCG (consumer goods). They are gaining ground even in the market of expensive gym equipment on the move. This, combined with high fuel and labor costs and insufficient road infrastructure, could lead to higher transport costs.
How Delivery Planning Can Grow Your Business In 2022
According to the survey, in addition to marketing costs, the D2C brand perceives high transportation costs as a major threat to growth. The fifty D2C brands surveyed said they spent $40 million on shipping in FY21, a 42% year-over-year increase in total shipping costs.
Industry experts also note that the biggest ban on D2C branding is the distribution of products with free/low shipping.
This is an interesting use case. Shipping low-cost products (INR 1,000 or less) all over India D2C will generally see a sharp drop in profits due to very low margins.
But in a world driven by convenience, where all brands wish for each other, by providing on-time and fast delivery, choosing the right logistics provider is crucial.
Plan Is To Build A $10 Billion Company, Says Delhivery
Gurugram-based courier giant Delhivery aims to boost India’s D2C brand with cost-effective solutions and technology. With its distribution network spanning 18,454 pin codes, the giant is focused on solving the brand’s pricing issues.
The company was founded in 2011 by Sahil Barua, Mohit Tandon, Bhavesh Manglani, Suraj Saharan and Kapil Bharati. It is a complete supply chain player that offers expedited shipping/delivery (partial and full freight), cross-border transportation, warehousing and order fulfillment, among others.
It operates with over 29,200 customers including D2C Markets, SMEs and employs 38,624 end distributors. With a presence in India spanning over 35 years, Delhivery has so far opened a pan-India distribution of 1.7 billion.
Backed by notable investors including SoftBank Vision Fund, Nexus Venture Partners and Carlyle Asia Partners, the logistics unicorn launched its IPO on May 11, 2022 for $4.55 billion.
Strategy Study: How Nike Runs The Sportswear Game
In May, the company disclosed that its operating profit rose 89% to Rs 6,882.2 Cr during FY22.
During the 2022 D2C Summit, Delhivery Vice President of Sales and Marketing Rohan Shanbhag pointed out that “when brands use too many logistics partners for various logistics needs like warehousing, inventory management and last delivery costs increase.”
Recently, the market has been concentrated by a number of third-party logistics aggregators (3PL) and independent courier / shipping companies. These include names like DHL, DTDC, Xpressbees, Blue Dart and Shadowfax.
Rajaganesh Sethupathi, Head of Enterprise Solutions, Delhivery, said this is where Delhivery’s entire suite of logistics solutions comes into play. “We have 11 years of experience in the logistics sector and have developed and adjusted our solutions in line with market trends.”
Delhivery Ipo: Delhivery To List In 6 8 Months, Expects To Raise $500 Million Via Ipo
Here’s a closer look at how Delhivery enables a D2C brand to explore logistics challenges with its technology stack and improve customer experience for better business growth.
A D2C brand needs to monitor inventory in real-time to ensure orders don’t sit in stock and add value to the supply chain.
Delhivery’s proprietary warehouse management system enables a D2C brand to manage multiple channels. Brands can put the right amount of inventory in the right place based on seasonal variations in order quantities and demand patterns. Brands can use an order allocation algo to select the best warehouse to serve orders from.
Delhivery provides supply chain services to help the D2C brand optimize costs. It combines warehousing and logistics operations, network infrastructure and technology built on deep data science and business intelligence capabilities.
Delhivery Exploring Its Business Model And Key Takeaways
Its more than 90 warehouses are strategically located in more than 35 cities (to bring inventory closer to customers). In addition, technology-based solutions such as intelligent route optimization and geocoding for ultimate distance distribution and real-time fleet tracking all help the D2C brand reduce costs.
In addition, Delhivery offers a variety of solutions – from data analytics, cross-border and express, part-time and full-time (PTL and FTL), etc. It can avoid using multiple shipping partners for different needs. This reduces transport costs.
“We built our AI platform after analyzing over 1.7 billion order data points from our successful distribution to date. In fact, the more data you add to the algo, the more functional it is. “Better,” Shanbhag said.
The company says the AI device integrates and learns more than 1 billion data points, 30 million addresses, 4 billion vehicle GPS tracking points and 2,700 terabytes of computer vision data.
Delhivery Business Model: How Delhivery Makes Money
This data is collected through GPS, CCTV cameras and internet connected devices. Delhivery uses data-rich insights to generate insights related to latest deliveries, address corrections, vehicle movements and warehouse operations.
Many times orders are returned to original source (RTO) for various reasons such as damage, customer unavailability, or orders not being shipped due to incorrect or incomplete customer contact details.
Delhivery’s NDR (Non-Distribution Reporting) system allows brands to identify potential RTOs or undelivered items (due to incorrect or unavailable user addresses).
Delivery sends undelivered messages to recipients via WhatsApp for verification without manual intervention. This automated, real-time recipient verification helps brands improve referrals by 10%, they claim.
Delhivery To Expand Infra In Greater Mumbai, Bengaluru
The company added that its QC (quality control) gateway procedures for returns could further reduce costs and increase CX. The final agent can perform quality inspection instead of the brand at the customer’s doorstep. It helps in filtering wrong / damaged products. The company said the brand can even start the refund process immediately, which improves NPS (net advertiser score).
Staying competitive in a crowded place is not easy, especially in a market where customer loyalty is rapidly declining and the law of instant gratification. Thus, the entire delivery mechanism, a customer service-driven function, emerged as a core operation. After all, nothing increases brand value to customers more than providing timely and reliable products without compromising quality.
Logistics is still a major growth factor as online shoppers from India’s border region are expected to account for 54% of total e-shoppers by 2030, accounting for 24% of online spending. This could be a huge addition to the D2C brand if they can supply remote areas of the country to keep up with the rapidly growing market potential.
As a new era, disruptive brands increasingly rely on logistics solutions powered by precise, economical and scalable technologies, India has seen explosive logistics activities.
Unicommerce Continues Its Growth Momentum In India And In International Markets
According to Statista, the country’s entire road transport market is expected to reach $330 billion by 2025, growing at a CAGR of 8%. Moreover, nearly 63% of the total demand will come from on-demand intermediate deliveries, representing the rise of integrated door-to-door solutions from Delhivery and its ilk to meet the newfound needs of brands across India.
“We are present in many deep pockets of the country and can help brands expand their reach while ensuring seamless CX,” said Shanbhag.
It also runs a quick trade through its small network of warehouses or intracity. Delhivery is currently building capacity for the service, which plans delivery and last-mile service in more than 10 cities. However, Q-commerce hyperlocal delivery is still popular in the city and may not serve the big D2C brands.
Real game changers for the brand are building a Pan-India logistics network while keeping prices low. And this is where the government’s National Logistics Policy (NLP) can help.
Is Delhivery Safe?
In September 2022, the center launched NLP to ensure the latest fast delivery. It also aims to reduce transportation costs from 13-14% to 10% by improving supply chain efficiency through robust technology infrastructure and strengthening connectivity.
This could be a huge boost for D2C brands and technology-enabled delivery providers like Delhivery. When conditions are right, SMEs, promotional partners and other stakeholders can help restructure the unorganized sector and make it more efficient and cost effective.
Mr. Shanbhag said the reduction in transportation costs will reduce production
