Following successful trials of e-commerce deliveries in regions of rural India that are yet un-serviced by online commerce companies, India’s latest delivery firm, Connect India E-commerce Services, will next week officially launch its last mile network of distribution points for e-commerce across India.
The network will cover 17 States, 150 towns and cities with 1,500 Connect India centres in rural and urban markets.
Bangalore-based Connect India E-commerce Services was founded in 2014 by Vijay Mahajan, an influential Indian business man, who was listed by Business Week Asia as one of “the 50 most influential Indians” in 2009, and LR Sridhar, one of India’s logistics veterans, who has been involved in logistics & supply chains since 1981. Prior to joining Connect India as co-founder and director, Mr Sridhar was heading Chennai-based South Asia’s largest bulk and container cargo company Sical Logistics Limited as Group Managing Director since 2006.
Prominent managers are running Connect India
On its website, the company lists Mr Mahajan and Mr Sridhar as co-founders and directors, while other board members include managing director Vineet Rai, who is also co-founder of Aavishkaar, Connect India’s main financial investor, and Ram Menen, former Divisional Senior Vice President Cargo, Emirates. Other directors include Ms.Fantry Mein Jaswal former Chief Commissioner of India’s Customs and Central Excise Department, and Noshir Colah, an executive director of investor Aavishkaar.
Connect India will link communities, producers and customers throughout the country by establishing 45,000 Last Mile Distribution (LMD) points in 25,000 postal pin codes with logistics and Internet supported by "a world-class mobile-first technology to revolutionise distribution."
E-Commerce sector is expanding rapidly in India
India is one of the fastest-growing e-commerce markets in Asia/Pacific along with China and with an expected increase in internet penetration, adoption of smart phones and lower data rates, shopping in India is expected to change significantly. Due to this digital revolution, the e-commerce sector in India has become 4 times its size, from US$3.8 billion in 2009 to US$17 billion in 2014. The sector is expected to cross the US$100 billion mark within the next five years, contributing over 4% to India’s GDP.
Though the online retail market in India, currently at US$1.6 billion, is a small fraction of India’s overall US$500 billion retail industry, retail e-commerce has recorded a three-fold growth since 2011, predominantly driven by million dollar investments by companies such as Amazon and China's Alibaba, but also by domestic leader Flipkart.
According to Connect India, there are 58 million small and household enterprises which have been recognized by the Indian government as key economic growth generators. Connect India plans to bridge the sellers from these segments to national and international commerce through its CICs using the e-commerce platforms.
Meanwhile, India Post is targeting a 50-fold increase in e-commerce revenues. "With decline in document shipments, e-commerce is our department’s new focus," a top official at the Department of Posts was quoted as saying. "We are targeting Rs 5,000 crore (US$1.1 billion) in revenue from this segment alone in the next 24 months."
Nol van Fenema