Thousands of products from e-commerce companies such as Amazon,
Snapdeal, Flipkart, HomeShop18, Shopclues, Naptol and Yepme are reaching
the remotest corners of India everyday, owing to their last-mile
partnership with India Post, the government-operated postal network. On
its part, India Post transacted business worth Rs 500 crore in
cash-on-delivery alone for e-commerce players in 2014-15. Its revenue
from this business rose from Rs 20 crore in 2012-13 to Rs 100 crore in
2013-14. But that’s just one side of the story.
To reach as many customers as possible at the fastest pace, even if
it means getting drones to do the job, online retailers are learnt to be
coping with the infrastructure hurdles of India Post. In fact, many
leading companies are said to be directly in touch with Union minister
of communications, Ravi Shankar Prasad, as well as senior bureaucrats in
the ministry, to resolve last-mile issues.
While e-commerce companies tied up with India Post to reach India’s
interiors and access pin codes that no courier company could, this has
helped them only in a limited manner. On bicycles, India Post delivery
men hardly match courier boys on motorbikes, who are faster and are also
able to carry heavier parcels. Some postmen have to walk on rough
terrains to reach distant addresses with parcels containing anything
from mobile phones and apparel to fancy accessories and kitchenware.
A senior Snapdeal executive told, “As most of the India Post team
uses bicycles, we have ensured products weighing less than five kg are
routed through them for delivery.” Against that, a courier delivery boy
often carries parcels 10 times the size, according to industry sources.
An Amazon spokesperson said, “We appreciate and understand that the
last-mile delivery methodology of India Post is mostly on bicycles and
we are in discussions with India Post to come up with a
solution/delivery methodology for large-sized Amazon packages.”
Flipkart did not respond to a questionnaire on the issue.
An official at India Post said the department was gearing up for the
challenges and infrastructure was being upgraded. The department has
already generated substantial revenue from its tie-up with e-commerce
companies. While there’s no word yet on replacing bicycles with
motorbikes and on whether the current India Post delivery staff,
typically much older than those employed by private courier companies,
are ready for the change, the official said logistics could be
outsourced to a third party for delivery of goods, depending on volume.
Currently, the slow mode of sending parcels via India Post to pin
codes unheard of is upsetting the sales targets of top e-commerce
companies, for which every missed delivery could translate into a lower
GMV (gross merchandise volume) and valuation. Also, it could mean
missing the next round of funding from a marquee investor.
There are other issues, too. For instance, a Bengaluru-based online
retailer-cum-stylist had partnered India Post in 2013. However,
according to its co-founder, the two-year-old company had to discontinue
the arrangement after it was found postmen were seeking money from
customers for deliveries to remote areas such those in the Northeast.
“Such incidents are serious enough to malign the reputation of a
company,” he said.
Another challenge is the India Post delivery team doesn’t get any volume-based incentive because it’s a government organisation.
On the other hand, private courier companies were often enthused by such offers, an official said.
The fact that 70-80 per cent of orders for companies such as Flipkart
and Snapdeal are from non-metro areas shows how critical it is for them
to compete in the remotest parts of India. Amazon, for example, took
pride in saying it had delivered a parcel to pin code 790002 — a
destination called Balemu in Arunachal Pradesh’s West Kameng district.
The dark side of the e-commerce revolution is equally real. A recent
Wall Street Journal report had highlighted the plight of courier boys
carrying parcels weighing 23-46 kg in large backpacks day after day, all
for a monthly salary of less than Rs 10,000. “This low-tech army of
urban sherpas hauls bags of online purchases down narrow alleys and up
flights of stairs, lugging everything from laser printers and kitchen
appliances to cans of Coca-Cola for their country’s burgeoning consumer
class,” the report had said.
Source:http://www.closevoice.com
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