Aiming to further bolster itself as an independent logistics powerhouse Flipkart’s logistics unit, Ekart, is set to launch a courier service that will take on the likes of DTDC Express and First Flight Courier.
Flipkart is en route to building a consumer-facing vertical to complement its core supply-chain management business. Ekart’s clients now include Madura Garments as well as online retailers Jabong and Paytm.
Getting down with an aggressive plan for its courier service, Ekart aims to capture 5-10 percent of the market in the first year. Ekart Courier expects revenue of more than Rs 200 crore in the next one year effectively squeezing out more revenue per delivery executive from the consumer-to-consumer courier market, which it pegs at Rs 2,200 crore.
Amitesh Jha, vice-president at Ekart, “We expect this service will be as disruptive as Flipkart’s entry into the e-commerce space. The industry is still very unorganised. No one provides an end-to-end proposition that consumers want.”
Ekart Courier will provide customers door-to-door pick-up of parcels in under 4 hours and delivery in two days. Customers can book the service online and get real-time tracking and SMS updates. Ekart will offer complimentary packaging.
The pick-up service will be rolled out in Bangalore next week and in 50 other cities by September. Ekart Courier will drop parcels at any of the 3,800 pin codes it directly reaches across the country.
According to reports, Ekart also has plans also to enter the hyperlocal logistics market and has started piloting deliveries for restaurants in Bangalore, though nothing was confirmed by Ekart.
Jha did not disclose the pricing but said it will “be competitive to tier-1 courier players. We will be offering far more value for the same cost.”
Experts said that courier companies, which include regional and national, handle about two million shipments a day with networks of thousands of branches. Parcel sizes are typically less than half a kilogramme, whereas e-commerce parcels are usually 1-2 kg.
Jha said he is not worried about the competition and that he expects Ekart’s entry to expand the courier market and increase the number of packets delivered by each delivery executive. “Every additional item increases utilisation (of the executive),” said he. Ekart has about 15,000 delivery executives.
For its core business-to-business logistics facility, Ekart is aggressively seeking external clients and 50 companies have expressed interest in its services, Jha said. “We will have six customers in e-commerce and four in the normal B2B business boarded by June,” he said.
By next year, Ekart expects shipments from non-commerce businesses to contribute to half its revenue. The company handles deliveries for third-party online retailers under a new initiative called ‘Fulfilled’ by Ekart.
