Choosing Logistics Partners for your E-commerce Business

Posted on December 28, 2018

The Logistics Sector in India is worth 160 billion USD as of today and is expected to grow to 215 billion USD within the next two years. Integrating the use of IT and innovations to reduce costs and improve quality management has contributed to this. The ecommerce boom in India has played a major role in this as well and will continue providing impetus to the growth of the Logistics Sector.

growth of ecommerce user This throws light on the making the right choice for a logistics service provider for your business. Many factors may come to your mind – reliability, cost, efficiency, adequate use of technology, etc. India’s logistics service providers were ranked 32 worldwide in terms of competence and quality. This indicates that there is a lot of potential, not just for this sector, but for the inter-depending industries as well. Here are some popular logistics companies to choose from:

1. FedEx – Providing premium services with competitive pricing, FedEx can be counted as an established and reliable service partner. However, it does not have a broad network in India and only delivers to major cities.

2. DTDC – This is a Swadeshi, cheap, reliable and convenient choice with a very broad coverage across India. However, it may not have a very good connectivity abroad.

3. DHL – DHL is one of the most innovative logistics partner worldwide, providing reliable, efficient and quality services. However, being a German company, DHL may not be the best choice for businesses looking for a partner with a vast network in India.

growth of ecommerce user 4. Blue Dart – This is one of the most ethical and innovative Indian logistics companies, providing quality services across a broad network in India. The demerit, however, is that it is a premium brand with premium prices.

5. First Flight – With partners like Sony, Samsung and Myntra, First Flight has built a good reputation over the years. However, they are still growing slowly compared to the other players in the ecommerce segment.

6. Create your own logistics division – The advantages of insourcing are more than just reliability and cost. Imagine a warehouse, with employees being trained about the process of handling inventory and packaging products, with the choicest of lean practices. Your customer being handed a beautiful box with your company’s design and logo. The customer getting a feel of the exact packaging that you saw the product being wrapped in, and then opening the box to be surprised with the quality of the products and how they were neatly placed, just the way they looked in the warehouse. However, this may require additional capital and will take a lot of time and effort to establish.

growth of ecommerce user Several businesses choose to partner with at least 5-6 logistics service providers, as each provider has its own speciality and demerits. For example, Logistics A may be very efficient but may not deliver to certain pincodes. And if Logistics B does deliver to the all pincodes efficiently, they may not have the expected quality management. Hence, by having 5-6 logistics partners, businesses have the flexibility of picking different partners as per their changing needs.

Some businesses wish to emulate the choices of big ecommerce players. For example, Amazon has a broad logistics portfolio with its own as well as a diverse range of outsourced logistics providers, which ultimately helps it to establish the goal of reaching out to customers all the way from Leh to Lakshadweep. However, the bigger picture is which provider/s can fit in with the requirements of your business and ultimately contribute to the satisfaction of your customers.