MAY 07, 2021
When international brands come to India, and sell only through e-commerce, imports, warehousing and delivery of goods can be complex. Delhivery Cross-Border simplifies that.
The growing Indian middle class, their increasing disposable income, and the increased share of women in the workforce have made India a big fashion market — the sixth largest globally. Add to it the deeper internet penetration and 4G access in the last few years, India is second only to China in its online market size. This makes the country an attractive target for international fashion brands.
And we’re able to see the change — in 2019, McKinsey projected that over 300 foreign brands are poised to enter the country in two years. While the pandemic may have put a stick in those plans, global brands are entering the Indian market through e-commerce. This can either be online marketplaces or their online store, both on the web and through mobile apps.
As e-commerce drives the growth of international fashion brands entering India, they are likely to encounter logistics complexities.
Today, the import of goods for fashion retail happens in the B2B2C model. In the B2B phase, an importer on record imports the goods does the customs clearance and stocks it in a warehouse. In the B2C phase, the local importer ships the goods to end consumers who have placed the order online.
Depending on the kind of goods sold and their value, brands choose either the just-in-time (JIT) process, where the products are shipped from overseas after the consumer places the order; or import-and-stock model where a local representative imports the products in advance, based on demand predictions.
While fashion brands choose just-in-time delivery of goods, they face a bunch of challenges:
An end-to-end supply chain services company like Delhivery can help brands overcome these challenges and optimise their logistics efficiencies.
First-mile pickup: From China, including customs clearance.
Warehouse management: Bringing parcels to warehouses for inventory management and relabelling.
Freight management: Air freight to India and managing destination clearance on arrival.
Last-mile delivery: Taking products to the end-customer in India.
On the other hand, when brands can predict demand — whether it’s in individual locations in the country or based on events such as festivals, sales etc. — it is often more cost-effective to import in bulk. However, it so happens that sometimes, there is no confirmed space in air freight, forcing them to choose ocean freight, which is slower.
Delhivery’s end-to-end supply chain services are designed to help brands overcome these challenges. Through our partnership in Starfleet, we ensure that there is confirmed space available for our clients on air freight. We also offer guaranteed upliftment for clients in China.
Choosing between just-in-time orders and B2B orders is a decision typically of the amount of data an organisation has. In the first few months of entering a new market like India, brands might not have the data to predict demand. As a result, going the B2B way might lead to too much or too little stock, causing supply chain inefficiencies.
So, brands typically start with just-in-time delivery through an international freight forwarder to identify demand areas across product-mix, key consumption categories and the choice of customers. Once some level of predictability is achieved, they import in larger quantities and stock effectively.
Delhivery Cross-Border, our global logistics services, can help international brands, whatever model they choose. It uses Starfleet — a global alliance of leading logistics providers and a network of clearance agents and forwarders — to ensure delivery. Delhivery can handle the end-to-end process efficiently and effectively, from first-mile pickup to last-mile delivery in Indi