Name of the company: Delhivery Pvt Ltd
May 2011Founders& Name: Sahil Barua
, Mohit Tandon
, Bhavesh Manglani
, Suraj Saharan
& Kapil BharatiLocation:
GurgaonFunding raised in 2017:
$138 millionJobs added since starting up/Strength of the company:
Over 15,000Industry it operates in: Logistics
Even as common sense dictates that inclement weather and traffic-choked streets can stymie the efforts of delivery firms, one may be surprised to learn that the real logistical challenge for them is to find the correct address.
Evidenced by the six-year experience of third party logistics venture Delhivery, the incorrect deciphering of addresses in India – which are admittedly complex – by machines will likely lead to deliveries at the wrong address.
“Over the last few years, we have realized that our challenges are bigger than last mile and cash on delivery,” says Sahil Barua, CEO and co-founder of the Gurgaon-based company. “With respect to addresses, we are working on a routing proprietary software that picks up the correct address in case someone has given a wrong pin code or character,” he adds.
This software – named “ADFIX” – does not depend on just a single character, but checks the whole address.
“We are continuously seeking tech-led solutions and constantly working towards improving our technological prowess,” he says. “This has led us to be a leader in logistics services with unmatched technology solutions,” he adds.
Although time will tell whether it will dart past larger players like BlueDart and Aramex, its journey crossing half a decade has been nothing short of remarkable.Game of trails
Originally conceptionalized as a hyperlocal delivery platform for food and medicines, Delhivery pivoted to servicing the online retail market after gauging the size and potential of the industry.
“When we started off, huge investments were going into online retail companies and we realized that it was only a matter of time before the space exploded,” says another co-founder, Mohit Tandon. “We identified logistics as a common crucial challenge facing every online retailer and given our backgrounds in engineering and technology, felt we would be able to build a unique value proposition,” added the IIT alumnus and former Bain consultant.
The founders& evaluation turned out to be more than accurate as demonstrated by the massive e-commerce boom, driven by increased penetration of cheaper smartphones and affordable internet. E-commerce has also witnessed a spike in companies outsourcing fulfilment operations to serve additional orders during festive sales when online shopping peaks.
“The digital supply chain opportunity in India is expected to be larger than $100 billion in the next five years,” the company claims on its website. “With faster technology adoption, we expect Indian businesses to fundamentally alter the manner in which they transact,” it adds.
Although Delhivery caters to non-ecommerce shipments as well, online retail makes up a large slice of its overall business. This comes as bigger players in the e-commerce space beef up their investments to strengthen logistics for fast and efficient deliveries.
Paytm Mall – Paytm&s e-commerce arm – recently invested Rs 225 crore in its logistics business and has tied up with Delhivery to expand its reach. The Tiger Global-backed company is also anticipated to enjoy a favourable partnership position with Flipkart.Plush package
According to a Traxcn study, funding to third party logistics (3PLs) service providers has increased by nearly 20% in the first half of 2017, compared to the same period last year. According to data from the research firm, Delhivery has acquired a massive share of these investments with $138 million round led by The Carlyle Group
, Tiger Global Management
and Fosun International
As per an earlier ET report, this values the company at close to $700 million.
“Our aim is to become India&s largest and most profitable fulfilment company for digital commerce,” says Barua. “We bring cutting-edge technology to introduce solutions that span the entire digital commerce value chain,” he adds.
In under half a decade, Delhivery has acquired one of the biggest investments in the logistics market in India, multiplying its job potential 15x times in five years since its launch.
“After months of planning and optimisation, we launched our express logistics services in June 2011 and delivered over 500 shipments per day for five e-commerce clients in Delhi-NCR,” says Tandon. “We also opened fulfilment services in Delhi and Chennai less than a year later, processed up to 50,000 shipments a month and delivered up to 9,000 shipments a day in the same period,” he says.
In the years that followed, Delhivery continued to expand its express logistics and fulfilment services in addition to launching a suite of commerce technology, including Vendor Panel, Godam and FALCON.
“Today we fulfil over 10 million orders a month with 99% fidelity and fulfilment timelines between 30 minutes and 72 hours,” claims Barua. “We are also present in over 950 cities and in more than 11,000 pin codes with fulfilment space spread across 5,00,000 sq ft and supporting over 1,00,000 sellers and more than 3,000 ecommerce companies,” he adds.
While untraceable addresses and poor weather will remain recurring bottlenecks for the company, it is on the path to profitability as it continues to work on building large infrastructural technology platforms.
“We will continue to invest in technology and automation to further improve network speed, reliability and reduce costs,” says Barua. “We are also investing heavily in developing new capabilities in B2B for our clients in retail, pharma, auto, FMCG and industrial segment,” he adds.