India's e-commerce boom has fueled the entrepreneurial spirit among the youth. Along with e-commerce, logistics became one of the crucial sectors that saw the emergence of a handful of startups. Nayan Ratandhayara (29) worked as a Finance Director and was on the board of directors of a teleshopping company, where he became well-acquainted with the ground realities of the logistics business in India. In December 2012, he came up with the idea of logistic venture AVN Business Solutions to cater to the e-commerce industry.
Nayan shared the idea of AVN Business with his friend Vishal Totla (30). In April 2013, the duo officially incorporated AVN Business Solution and started operations from September 2013 in Mumbai.
e-commerce was taking place at the same time rapidly and we saw new sellers were not able to sell because logistics was there main concern. Many big players were losing money due to delay in shipping and courier charges.”
Initially they started with two products Shipyaari (Simplified Logistic) and eRunnerz (Customised Logistic). With Shipyaari, they help small and medium sellers by giving them single account and dashboard to use multiple courier companies services, single pricing, single data templates, and more. Moreover, it also makes sure of the SLA defined delivery of the shipment and provides complimentary insurance and 10 days COD remittance cycle. It has tied up with eight leading logistic players including India Post Service and cover more than 22,000 pin codes across the country. Shipyaari has witnessed more than 2,000 registered users.
The moment a user gets registered with AVN, he can immediately start using the dashboard to schedule the shipments. Moreover, the clients can reach out to AVN via call, mail, and chat.
The key motive of eRunnerz.in is to escalate intra-city deliveries and this service is tailored for impulsive buyers, financial institutions, home makers, and traditional courier business. Currently, it offers four-hour delivery across Mumbai for Rs 99.
Usage of technology
According to Nayan, the whole information system of AVN is designed in such a way that algorithms can capture data from websites, calculate costs, track shipments, prepare client bills and reconcile Cash on Delivery (COD).
He says, “For intra-city delivery, we are recording the data points to make quicker deliveries and optimise the route.”
Nayan is a Chartered Accountant by profession and has worked as Finance Director in a teleshopping company for three and half years and finance head for an Event Management company for about one and half years. During the tenure at these companies, Nayan used to work for the company during day time and dedicate the nights and weekends for AVN. Finally, he quit his job in August 2015 and dedicated his whole time to his venture.
Vishal is a commerce graduate and an aspiring CA who used to run his own electronic trading business where he gained extensive experience of selling on platforms of all major e-commerce portals which allowed him to handle logistics for distribution.
Walking extra miles
With a team of 50 employees, AVN build a client list of 2,500 in Shipyaari and 75 clients in eRunnerz. Shipyaari caters to pan India and eRunnerz is only present in Mumbai. Nayan emphasizes that Bhavesh Thakkar (Manager-Sales and Operations) leads the Shipyaari business from front so that we can focus on the other segments of businesses.
In 2015, Shipyaari has seen about 700 shipments per day with an average of 17,000 shipments a month from about 1,000 clients. Currently, it does 1,500 shipments per day with an average of more than 30,000 shipments per month.
eRunnerz, which was officially launched in the mid of November 2015, has done approximately 2,500 shipments with a run rate of about 100 shipments per day.
AVN Business Solution is growing on an average rate of 50 per cent month-on-month. Till date, it has delivered products worth Rs 350 million and remitted COD payments of about RS 150 million.
In the next two years, the company aims to expand the presence of eRunnerz in Pune and NCR and tie up with e-commerce enabling service providers.
Our focus will be to increase this number to 3,500 shipments per day by the end of 2016. We aim to see that people from Tier 2 and tier 3 cities are more connected to e-commerce and shall provide them all kinds of services which are available in major and metro cities.”
The success of e-commerce in India is not only measured by its sales and GMV numbers but also the speed of delivery. Logistics is the backbone of e-commerce industry in India. The sector has seen the emergence of companies like BlackBuck, Delhivery, GoJavas, Ecom Express, and a host of on-demand companies. In terms of investment, it has seen the likes of biggies like Flipkart, Tiger Global, DST, Snapdeal, Warburg Pincus, and more.
According to the ‘Logistics Market in India 2015-2020’ by market researcher Novonous, the country’s logistics industry is worth $300 billion and is estimated to grow at a CAGR of 12.17 per cent by 2020.
Though AVN Business Solution has entered a crowded industry, as the data shows, the market is large with space for multiple players. However, the company will have to focus on execution and also offering unique solutions. DotZot, DTDC's e-commerce arm, has launched a service that lets customers pick up orders from outlets. A logistics firm will have to either offer the widest reach or unique services to stay competitive.