BENGALURU: Logistics unicorn Delhivery expects direct-to-consumer (DTC) model to gain steam as retail brands go omni-channel, and higher automation in a post-covid world, said a top executive.
The Gurugram-based firm, which has traditionally focused on large e-commerce and large clients, is now seeing increased demand from enterprise firms, smaller brands and even home entrepreneurs, as the new social distancing norms impact offline shopping in a big way.
In the past three months, the need to further digitise supply chains came to the fore with the lockdown-led disruptions, along with the ability to allow direct to consumer models.
During the lockdowns, Delhivery has added over 200 clients that primarily include fast moving consumer goods (FMCG), pharmaceutical and other retail brands where it is enabling transactions through an omni-channel format.
The startup has active pilots going on with large brands. Under the DTC model, customers, instead of visiting the store, can go online and find the nearest store and Delhivery can enable the transaction through an omnichannel format, from the store to home.
“Enterprise firms and even smaller brands are changing the way they do business and want to do DTC whether it’s fashion, pharma or baby products. We continue to add more clients each month, but beyond the large retail brands, the real focus is to enable supply wherever possible including small sellers and homepreneurs (home-based entrepreneurs) leveraging online platforms to sell both essential and home-made goods," said Sandeep Barasia, chief business officer, Delhivery.
With the post-covid era accelerating the hyperlocal model for retail brands, they are adopting it to optimize last mile fulfilment metrics of cost, time, logistics and inventory turns.
With large FMCG and pharma firms demanding a faster supply chain, Delhivery is also facilitating the ‘direct to retail’ model – from the warehouse to the store- to ensure availability is high, and there are no bottlenecks that can slow down the movement of goods.
Like DTC, it is conducting pilots for direct to retail as well with large players.
In the current scenario, hyperlocal delivery is becoming a part of Delhivery’s business for which it relied heavily on its last-mile delivery network, the startup’s co-founder Mohit Tandon said in a recent Mint webinar. As part of this, the startup had to figure out how to ensure deliveries in 2,3 or 4 hours to customer’s doorsteps, at a cost that is viable to the retailer.
With the covid-19 outbreak and the restrictions on movement, supply chain and logistics issue emerged as one of the bottlenecks during the lockdowns. While Delhivery has always kept automation at its core, Barasia said the aim is to scale it up across all its facilities in-line with some of its existing large hubs.
“...Automation enables people to work in a safe environment through social distancing and ensures continuity and productivity during a crisis. We are trying to merge the scale and complexity of India, collaborating with partners to design and develop systems from scratch. It’s not just about hardware automation, but the real thing is software automation to drive systems driven decision making for a highly responsive and flexible network," Barasia said.
Delhivery was valued at $1.5 billion in March, 2019, when it raised $413 million in a Series F round led by SoftBank Vision Fund, along with existing investors Carlyle Group and Fosun International. In September, the Canada Pension Plan Investment Board (CPPIB) bought an 8% stake in the company for $115 million from an existing investor.
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