How to serve an industry that has 

the highest service expectations?

The e-commerce industry is getting very competitive. At the same time it is very rewarding. In emerging markets like India, this is the best place and time to be if you are a Logistics Service provider. The new customers in town are huge e-commerce companies.

The more they sell the more you earn. And this depends on trust they have earned. The same applies to you. The challenge today is to differentiate. You may have a lot to offer, but your customers and partners ask: what else can you offer?

Major LSPs are expanding their portfolio to serve this industry or even investing in new companies. If you are starting today or in its infancy, how do you become the best bet for e-commerces companies?

Remember these three golden rules:

1. Being in the service industry, you know the importance of high service levels. Your customers are also part of the service industry, so they too live by the same rules. They depend on you to complete their experience.
2. On-time delivery is no longer an expectation. This has changed to before-time delivery – buyers are looking for instant gratification. You need to integrate yourself as part of your customer's process than be a vendor.
3. Your customers need to be preferred by customers and they are working very hard at it by adding a wide range of attractions. If you add to attractions that directly appeal to their customers, they will want to choose and stay with you for the long run.

The race has begun and in the next few years this industry will become the most relevant place to be. 

So what do you think? How will you grow in this industry?

How to better manage COD for E-Commerce deliveries

COD Collection and management is a key pain area for any home delivery company. Here are  some good practices that can be followed by courier companies to control COD:

1. Get order data from customer electronically

 So that courier company does not miss out marking a consignment as COD. Many a times a delivery is done but money is not collected at delivery branch does not see the order as COD. Sometimes courier boys asks for money from a customer who has already paid !!

2. Provider COD summary in Delivery Run Sheets

This way courier boy clearly knows total consignments that are COD and amount to be collected.

3. End of Day COD Closure process

When delivery run sheet is updated, system will provide a print of COD summary with actual delivery against planned and collection done. This is signed off by hub manager and a copy is given to courier boy. This will reduce disputes and post-mortem

3. Cash Deposit Process

Have a process of system driven cash deposit slips from delivery data. Also Cash deposit slip should be closed with a scan of bank deposit slip.

4. Bank Reco process

Online Reco of bank statement by regional team or central team against Cash Deposit slip closed in point 3 above. This will make sure that cash was actually deposited and bank deposit slip is not a fake

5. Customer Repatriation Module

Once cash is in bank across hundreds of locations, courier actually loses site of whose money was deposited. But delivery data linked with Cash Deposit Slip linked with reco can clearly tell what consignments are delivered and cash is in bank.

With this, a Customer Repatriation Module can prepare a Fund Transfer slip against consignments of a given customer. These are then marked as COD Repatriated

 

Above steps will give a courier company clear flow and visibility from Booking to Delivery to Collection to Deposit to Bank Reco to Customer Payment.

 

Electronic Toll Collections Starts on National Highways- FINALLY !!

The Ministry of Road Transport and Highways (MoRTH) is determined to introduce Electronic Toll Collection (ETC) over all the toll plazas situated at National Highways on all over the country within 31st March 2014.

This will be probably one of the best steps after abolition of state wise permits for commercial vehicles.

 

Here is a back of the envelope calculation:

 

• Mumbai to Delhi- 1600 km
• Toll plaza- every 100 Km
• 16 Toll Plaza
• Waiting time to pay toll- 15 min on an average (do note cars move faster than truck- even at toll)
• Time spent- 4 hours per journey !!
• Fuel spent in 4 hours= Rs. 2000 (ask me how I got this !!)

 

So you add 4 hours and Rs. 2000 per journey from Mumbai to Delhi just to PAY toll !!

 

Multiply by number of vehicle per day and you get the national loss. It is almost stupid that we are discussing this in 2013 when USA implemented the same in 1960s !! Even a Malaysia or a Thailand are ahead of us by 20 years in Electronic Tolling.

 

Electronic Toll should be a tender condition for anyone taking up a toll booth operation- this is not rocket science and technology costs nothing compared to losses.

 

Most importantly- a fine of Rs. 1000 needs to be enacted for vehicles using Electronic Toll gate without a tag. Else- it will be back to square one.

 

Will it be enforced? Give 50% to toll booth operator and it very much will !! Ever noticed the keenness and speed of towing guys to pull you vehicle away from no-parking ? Well they get Rs. 150 per pickup (In Mumbai) so they are more than keen !!

Can Vehicle Planning Software work in India?

Let us take an example of a trucking company with say 1000 vehicles with GPS mounted on all of them.

The company has also integrated a system like WebXpress with GPS. So the trucking company knows exactly where all vehicles are, where are they going and when will they reach destination(more or less, with a buffer of a few hours).

A trucker can invest in a planning tool to optimize his loading and reduce his idle time. If trucker can match all future demands with likely date of arrival of vehicles with a buffer time- he can commit capacity to these customers.

Seems basic. Does not work on ground.

Here is why:

GPS and system can tell when vehicle will reach customer point, but NO ONE can predict when vehicle will be FREED by customer. This will totally depend on stock situation at customer location, his production plan, other vehicles in queue and so on.

As the time when vehicle will be free is not known, NEXT customer can be committed a vehicle only after this vehicle is actually free. If committed in anticipation (as done in most cases today), you have the usual complaints of "Saab, Gaadi bus nikal gaya hai, thode samay mein aa jayega!!"

Given this uncertainty, the NEXT customer orders vehicle much in advance or from multiple players.

When you run this scene across customers, you have a totally unpredictable situation solved day to day on phone calls. This is why TRAFFIC DEPARTMENT- where people have 4 ears and 8 phones- is the most crucial for most truckers.

Can Planning Tools make a difference in such a scenario?

 

Supply Chain in Emerging Market Vs. Developed Nation

Emerging markets like India are often chided for their poor and unreliable supply chains. A much cited number- India spends13% of GDP on Logistics compared to 8-9% in Developed world. We are supposed to be wasting 30% of agri produce due to non-availability of cold chains etc.

But are our supply chain really that bad? Do we need our supply chain to be working the way it works in- say Germany?

Take example of cold chains- if all the food consumed by Indians were to move through cold chain- what will be additional diesel required with its impact on fuel subsidy bill?

Cold Chain vehicles consumes 5 times more fuel than a normal vehicle. Thus, if all vegetables moving from Nashik were to travel in temperature controlled vehicles- imagine the jump in fuel required.

This does not mean we do not need cold chains or reduce wastage. But we can not apply models of developed economy on emerging markets in an as is mode.