An Indian Transport & Logistics News webinar earlier this month, with an esteemed panel of guests, took a look at what the eCommerce boom had triggered behind the scenes in India, and the challenges and surprises that had arisen. Featuring Aaqyl Chagla, CEO or Rapid Delivery, Dibyendu Ganguly, CEO & Founder of EximScouts, H.S. Purushotham, Ex National Supply Chain Head of More Retail Limited and Varun Mimani, Head Fulfillment Operation at 1mg, the panel covered the entire eCommerce scope from last mile deliveries, to cross-border selling, retail supplies, and online medical care. Reji John, STAT Media Group Editor, moderated.
“The COVID-19 effect: adapting to the new normal for ecommerce
logistics” was the title of the webinar, and whilst it was focused on India, many of the challenges will likely be the same in other countries, given that both the pandemic and the
increase of eCommerce have been global phenomena – just as the grounding of flights was, too. From one day to the next, how we shopped, what was available, how supply chains ran, what new items
were required, and what the speed of delivery could be, all changed.
The Indian Retail Sector is a 850-billion-dollar industry and the 4th largest in the world, Reji John told us, also referring to it as being “largely unorganized”. “Gross Merchandise Value expected to be 100-120 billion dollars by 2025.” A massive piece of machinery, therefore, that spans a huge country broken down in a number of states, and thus already a pre-indicator of some challenges that were to come.
The first challenges
So, lock-down happens, people start working from home or are on furlough. Shops are closed, or not accessible because outside the containment zone, and eCommerce appears to be the solution. Not only are people wanting to obtain essential items, but they are also wishing to pass the time, and online shopping is perfect for that – and perfectly contact-less! Or is it? The challenge starts once Reji John’s three favourite words, “Out for delivery” appear on the screen: The last mile. At some point, there is physical contact – when the “delivery boy” hands the goods over to the consumer and requires a signature.
Aaqyl Chalga explained “Things have definitely changed with this pandemic. Social distancing has triggered a key change in how we interact with the customer,” and spoke of delivery boys being denied access to societies and consumers refusing to use a pen to sign anything. Very quickly, therefore, a move was initiated to contactless delivery processes.
Deliveries surge, manpower dwindles – not a good combination
That eCommerce interest grew, was of course a very welcome move, yet counterbalance this with lock-down regulations, and you come across delivery people having to return to their villages during containment, different containment zones posing problems for people wanting to get to work, special approvals needing to be sourced for those permitted to deliver, confusion everywhere as to who is considered an essential worker and is allowed to be out on the streets (even down to police brutality against authorized delivery boys, despite valid documentation). In a word: chaos, as everyone felt the strain of the unprecedented shut-down situation and having to cope with ever changing regulations.
On the other hand, because many lost their jobs at the start of the lock-down, there was also great interest in becoming delivery staff, so much untrained manpower potential was available.
Keeping everyone safe and healthy
Most delivery boys are daily wage workers and highly dependent on their jobs to secure their family’s livelihood. Though soon classed as essential workers by the government, many were fearful of catching the virus, and quickly welcomed and adapted to contactless processes. Yet, the risk of losing an entire team if just one member tested COVID-19 positive, was also always there, and one that delivery companies needed to prepare for.
Varun Mimanmi told of measures that were implemented after the first incident which had required a team to quarantine. Following that, full PPE was issued for staff and weekly audits were held to ensure that health and safety measures were being adhered to. This helped to boost staff morale and led to people staying in their job.
Speed is of the essence!
At the start of the lock-down, there was a lot of panic-buying of groceries and medicines. As people started to work from home and were sharing space with their family members who were perhaps being schooled from home, other items started being bought – such as comfortable clothes, extra IT products, even furniture. “Essential goods” became a vast array of categories. Yet, as the delivery times were often hampered due to flights being grounded (so imports drying up), railways not running, quarantine measures affecting normal inner-city deliveries, and much moving to road over long stretches, orders began being cancelled by customers not being able to see when they would receive their purchase and no longer having the confidence that it would arrive. A huge wave of cancellations hit, especially in the past few months.
The first mile pile-up
Panic-buying led to unforeseen shortages. In addition, finding manpower to stock shelves and ensure that enough produce and goods in each category were available, was also challenging. Lock-down created a chaotic stock situation with March being the month which saw India have its highest ever food and grocery sales driven by the panic-buying. As this settled down, the problem with cancelled orders created a knock-on problem of warehouses not becoming empty of old stock, which then led to liquidation sales to create space for new stock that was already pending. The interest of vendors in moving online also increased five-fold and it was predicted that, within the next 6-8 months, every vendor will have gone online in some form or another: omnichannel sales being the new trend. While cross-border eCommerce came to halt, overall vendors saw an increase in net realization despite the cancellations, and aside from the liquidation sales, discounts were no longer being offered.
One huge jump forward, was experience in the online health and medical services. Varun Mimani stated that the increase was such, that in one month his online healthcare platform had seen the same level of usage as in the previous 12 months combined. People were able to arrange medical consultations, order medicines from licenced pharmacist and have these delivered, as well as arrange lab tests and get the results online. In a virus pandemic situation, a perfect solution, and one that is not necessarily available in other countries. The pandemic led to accelerated acceptance of this way of getting medical advice and supplies, and – though there were initial challenges in delivery, through delays at delivery companies unable to differentiate between urgent medical shipments and normal ones, and partly being shut down themselves, through to the problem of leaving medicine in the hands of third parties (which was solved by direct customer phone communication), it looks like online healthcare is here to stay.
Varun Mimani pointed to “stickiness” already being noticed in regions where lock-down has eased. His company had restructured to create a pandemic team right at the start, purely focusing on the changing regulations, on sourcing delivery passed, following restrictions, communicating with authorities, and ultimately ensuring that everything ran as smoothly as possible after the initial chaos situation.
eCommerce is here to stay
eCommerce will definitely be the new normal in 2021, based on today’s developments. Nevertheless, the Indian joy in the “touch and feel” of products that they want to buy, and the ceremony of shopping for festivals and marriages, will certainly remain, too.
We always welcome your comments to our articles. However, we can only publish them when the sender name is authentic.