The COVID19 pandemic brought a number of sectors into the limelight around the world, one of which was Logistics, particularly in the Indian nation. We’re long past the days when Logistics used to take place on the sidelines, the sector is now the distinguisher.
The onset of the pandemic has brought both challenges and prospects on the fore for the startups. The most fascinating element is that both the prospect as well as the opportunity is logistics. The pandemic holds promising potential for daily services like e-grocery, food delivery, and e-commerce platforms to prove their competency and engage themselves in their customer’s everyday lives, with logistics held at the forefront.
In the present times, customers primarily give priority to aspects like convenience, and flawless service on any platform be it online or offline. Being able to supply these aspects puts a favorable image of these companies in the minds of the customers, and aids them in finding their place in the market.
Numerous startups have paved their way in becoming unicorns by giving priority to these features and specializing in exclusive services in the past couple of years. One such platform is Delhivery, a platform which essayed a large role in revolutionizing delivery services in the nation.
When it comes to e-commerce, logistics is one of the most crucial issues that the industry faces and claiming to provide solutions to these very issues - Delhivery has emerged. We’ll dive into more of its journey ahead.
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Delhivery facilitates an entire range of services which include last-mile delivery, third-party as well as transit warehousing, reverse logistics, payment gathering, vendor-to-warehouse, and vendor-to-consumer shipping, and so on. The platform is supported by Times Internet. The digital product firm had obtained a minority stake in the platform back in 2012.
Delhivery’s umbrella of solutions includes fulfillment (warehousing), storage management, Omni-channel, as well as data services. The primary aim of the firm focus is to facilitate the finest service minimizing the likelihood of being unable to solve the customer’s issues.
You can also take a look at this video where Delhivery’s founder Sahil Barua talks about his journey and the platform.
The platform facilitates products and services with the purpose of building trust and enhancing the lives of customers, small companies, enterprises, as well as their thriving lineup of employees and partners. The firm has shaken the logistics industry of the nation with their features such as their network design, infrastructure, engineering and technology abilities.
Delhivery emphasizes unmatched efficiency in cost as well as reach across the nation to more than 10,000 customers. The platform is propelled by the aim of minimizing time and distance, and making the world seem like a much smaller place for their consumers.
The firm aims at competing as the Indian nation’s biggest and most advantageous fulfillment platform when it comes to e-commerce. Delhivery constantly aspires to facilitate its consumers with high quality items and also to update them regularly.
Delhivery is definitely not without competition in the market. Several of its competitors include Flexport, Ecom Express, Blackbuck, DotZot, FSC, as well as Delex.
Delhivery has been established by a team of engineers namely, Sahil Barua, Mohit Tandon, Bhavesh Manglani, Suraj Saharan and Kapil Bharati.
Sahil Barua, the founder of the platform is a graduate from IIM Bangalore. He was also an employee at Bain & Company alongside Mohit Tandon, a Indian Institute of Technology Kanpur graduate.
Bhavesh Manglani, the COO of Delhivery is a graduate in B.Tech from Dhirubhai Ambani – I.C.T as well as an IIM graduate from Calcutta.
Suraj Saharan, Delhivery’s co-founder, is an IIT Bombay graduate in Mechanical Engineering.
Yet another co-founder of Delhivery is Kapil Bharati who also has a degree in mechanical engineering from IIT Delhi.
Delivery Business Model
Delhivery primarily has a B2B (Business to Business) type of business model, where the platform facilitates services which mainly concentrate on businesses. In this model, the charges are extended towards the businesses while the customers are not charged anything.
The business model of Delhivery
The services offered by the platform can be divided into 3 primary departments namely warehousing, transportation, and commerce. The majority of the platform’s business specializes in transportation. The platform emphasizes a ‘plug and play’ model and provides a resolution for all those consumers who wish to deliver their products to their respective consumers.
The platform emphasizes on the distribution model, in which each branch of the organization is conducted as a hub. This allows the parcels to be delivered to the consumers without encountering any issues.
The procedure primarily incorporates that every time an item is ordered online it is collected from the manufacturer and is then transferred to a processing unit from where it is placed in order to be sent to the destination. This procedure has been termed as a first-mile operation. Post this, a line haul is adopted for transporting the items to their destinations from the processing location. Meanwhile, in the last mile operation, the item is transported from the delivery system to the house of the consumer.
Origin of Delhivery
“It was 11.30 at night, I still remember, we took our bikes and went to meet the owner, Anuj Bajaj, who was surprisingly still there. He said he was shutting the restaurant down. He was really happy we had come because he wanted his staff to relocate somewhere. We said bring it on, we’ll hire everybody,”
On a certain day, late at night, Sahil Barua and Suraj Saharan had ordered a meal from a closeby restaurant and ended up having a chat with the delivery boy after which they had gone to visit the restaurant itself and had a chat with the owner. On learning that the restaurant was going to close, they undertook the duty of hiring all the staff which was present there. And hence Delhivery was born.
Initially, the company started out by attempting to furnish a resolution to restaurants and the issues they encounter in delivering food within an hour. This was primarily since they perceived a requirement for a delivery network for restaurants. Which was how they began with hyperlocal.
Steadily Sahil and Suraj began by carrying out and finishing the orders for delivery orders for the restaurants within the span of a half hour. Later on, the duo were accompanied by Mohit Tandon, Bhavesh Manglani, as well as Kapil Bharati.
The founders grasped the key component which had been overlooked by many of the other players in that market, the stark difference between traditional and e-commerce delivery and the large degree of scope that delivery within the e-commerce sector offers. And thus, they shifted their operations from the e-commerce segment to hyperlocal.
Despite the long-lasting pandemic, Delhivery is one of the few startups which has managed to perform and stay in demand.
"The reality is that there has been an increasing shift of companies who want to work now with more organized players in logistics. Earlier the industry was more unorganized. So for companies like Delhivery, we have been able to grow our businesses in this period because more demand has come,"
- Sahil Barua, Delhivery Chief Executive Officer & Co-Founder
What initially began as a tiny business with a mere 5 members in totality to execute all the operations such as delivery hookups, product service, etc has now over 15,00 people employed to carry out these operations and to ensure that their customers are satisfied.
As confirmed by Financial Express, the platform is now aiming to infuse Rs 300 crore in 18-24 months on expansion, which also includes enhancing fleet size and developing trucking hubs, for meeting the enhanced demand for increasing organised players in the sector amidst the COVID-19 pandemic.
A recent article by Business Today also confirmed that the platform is aiming to affix about 150 trucks to its fleet aside from establishing trucking terminals in Delhi, Mumbai and Bengaluru as it emphasises on observing revenue of approximately Rs 7,000 crore in the coming 24 months, a rise from Rs 2,800 crore in the previous year.
The platform claims to have gained a turnover of Rs 2800 crore for FY2020 and has the target of reaching Rs 6000 - Rs 7000 crore in the coming two years
Presently in 2020, as confirmed by a Mint article, Delhivery delivers about 1.5 million orders per day, with almost 3,000 tons of cargo each day, in more than 17,500 pin codes in India across 2,300 towns, cities and villages. The platform has a network of around 7,000 drivers and more than 5,000 trucks.
It all began in April 2012, when Delhivery initiated its first round of funding, i.e its Series A round where it raised $1.5 million through Times Internet Limited. This kickstarted the growth and development of the platform.
So far, Delhivery has raised a total of $934.5M in funding over 9 rounds.
The latest 3 fundings of the platform took place in 2019 when Delhivery hoisted $413 million in a Series F funding round, emerging as a unicorn. The round had been headed by SoftBank, Fosun International as well as Carlyle Group.
Following this, in the same year, the platform hoisted $150 million in the month of June and $115 million in the month of September, both from the Canada Pension Plan Investment Board (CPPIB). Hence the platform’s most recent funds had been hoisted through a Secondary Market round.
“After every 20 minutes, I get up and go talk to a team member. Thanks to this, I know everyone in our office by their first name. We have that kind of openness in the office where people can tell us what they think. That is what keeps us going”
- Sahil Barua, Delhivery Chief Executive Officer & Co-Founder
What began as a mere hyperlocal express delivery service for offline stores delivering from boutiques and restaurant food restricted in the city of Gurgaon in its initial couple of months, has now emerged as a leading platform in e-commerce logistics. With the demand for more effective and organized logistics players growing in the present scenario, the platform shows great promise for further growth and expansion in the future.