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Statista, citing BCG, Morgan Stanley, Bain and Co, estimates that India’s e-commerce market is $80 billion. This is likely to reach USD 350 billion by 2030. Given such huge potential, retail and e-commerce players are investing heavily in market presence, product offerings and vendor ecosystems. But one of the key challenges of e-commerce is logistics. Just appreciate the size of India – over 1300 million people, spread over 3.28 million square kilometers. India has more than 100 cities with 500,000 inhabitants and more than 600,000 villages. Not every retailer has the deep pockets of Amazon, Reliance or Walmart to build a national infrastructure of warehouses, transport hubs and fleets. Therefore, they have to work smarter and still compete hard for the huge Indian market.
This is where the role of e-logistics solutions becomes crucial. Retailers can leverage a range of technology solutions to manage various logistics-related activities to efficiently fulfill e-commerce orders.
Let’s understand this with a case. A leading Mumbai-based retailer with over 350 stores across India needs to leverage its in-store inventory to fulfill e-commerce orders. Suppose a retailer receives an online order for a men’s formal shirt – to be shipped to Valsad, Gujarat. E-logistics solutions help in tracking stock in the nearest possible stores, says Vapa. The solution then intelligently assigns orders to the store operator’s mobile app with a photo and product details. A store operator visits the exact location, picks up the shirt and prints a shipping label using the same app. The logistics partner picks up the shirt and delivers it to Valsad – all within just one day!!
As we can see from the example above, the seller made smart use of the stock in the nearby store and also ensured accurate and fast delivery – with minimal costs.
Let’s take a look at what solutions are possible across the value chain.
Seller’s logistics solution
This solution enables hassle-free pickup from retailer locations and ensures delivery to the right fulfillment center or directly to the consumer’s location. The logistics solution is integrated with the seller’s portal and logistics provider’s systems to coordinate all activities from order preparation to logistics scheduling to pickup confirmation to tracking to arrival at the fulfillment center.
A smart logistics hub
This solution helps a logistics company manage thousands of orders, sort them and connect them to the right locations. Logistics software is integrated with a robotic sorting system. All shipments are scanned and automatically routed by the sorter to the correct packaging location.
Dock management solution
Logistics hubs can have as many as 40-50 docks – places where vehicles are loaded and unloaded. During peak hours, these hubs handle more than 50 vehicles. The e-logistics solution helps to automate the movement of vehicles in and around the hub. It assigns the exact berth to the vehicle and directs drivers via WhatsApp messages.
The last mile delivery solution
The most important part of any e-commerce is the delivery to the customer’s door. But finding these doors in India can be quite a challenge. Also, customers can be fickle and change their mind about the delivery time, and they can refuse the shipment. According to industry estimates, last mile delivery accounts for 50% of total e-commerce logistics costs.
Therefore, an e-logistics solution is needed to plan delivery routes, assign the same to cyclists, track cyclist movement and delivery progress, and confirm delivery. Data from all such deliveries is integrated with a tracking portal and messaging system to inform customers.
Control tower
Given multiple technology solutions and partners, retailers need a comprehensive control tower to monitor all orders and activities in the e-commerce supply chain. Control Tower Technology’s solution triggers the central team and alerts them to various potential problems. For example, if the vehicle is at the dock for too long, the seller has not delivered the material, or the delivery person is stuck in the last kilometer at the customer’s location – many such alerts can help the control tower team to intervene and ensure things do not escalate beyond the point.
Above are just a few examples of key logistics technologies needed to provide quality service with efficiency and optimal costs. There are many other systems such as warehouse management, cash logistics, cargo and route planning, GPS tracking and EV tracking that are needed to solve specific problems.
Overall, Indian retailers and e-commerce companies need to come up with solutions that suit Indian conditions. Many robotic solutions, drones or autonomous vehicles may not become suitable for large-scale operations for several years.
Finally, retailers need to be mindful of the carbon footprint of e-commerce as millions of kilometers are traveled to deliver orders to a billion people. In the coming years, technological solutions for emissions monitoring and compliance will become very important.
(DISCLAIMER: The views expressed are solely those of the author and ETRetail.com does not necessarily subscribe to them. ETRetail.com shall not be liable for any damages caused to any person/organization directly or indirectly.)
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