According to the All India Motor Transport Congress, there are close to 12 million trucks in India and about 90 percent of them belong to single-truck owners — small entrepreneurs — in small towns. This is what makes it difficult to integrate technology into their lives.
In 2017, India's logistics and supply chain sector has witnessed two big moves by the government - Goods and Services Tax (GST) implementation and giving infrastructure status to the sector. The steps are aimed at organising the unstructured logistics sector and open doors for more investment.
Recently, the government also launched the new logistics index across different states to assess the logistics performance of Indian States and Union Territories. Gujarat, Punjab and Andhra Pradesh occupied the top three positions, while Assam, Bihar and West Bengal lower bottom of the index.
According to Associated Chambers of Commerce (ASSOCHAM), the global logistics market is currently estimated to be around $3.5 trillion. India spends around 14.4 percent of its GDP on logistics and transportation compared to less than eight percent by the other developing countries.
Considering the booming potential of the industry, several new-age companies have entered the logistics industry to replace traditional methods with efficient solutions using technology. Here’s a list of some of the many startups that aim to transform the sector.
FreightBro: Leveraging the power of technology, Chennai-based FreightBro enables freight forwarders to make data-driven decisions, predict changes in the market and provide better value to shippers.
BlackBuck: Bengaluru-based BlackBuck is a B2B inter-city full truckload marketplace. The transporters essentially need demand and B2B clients need trucks. BlackBuck provides these trucks to these businesses. Clients request for trucks based on the size, timing, and other shipment specifics.
Trukky: Leveraging the power of technology, the web and app-based online logistics platform offers a modernistic and simplified way of truck hiring and tracking at fingertips. With rate index, live pricing and a three-step booking feature, Trukky aims to bring in more ease and transparency in the trucking ecosystem.
Rivigo: The company provides high-quality services across major industry verticals such as e-commerce, FMCG, auto, pharma and the cold-chain space. With a large network of company-owned trucks, Rivigo offers line-haul solutions, and claims to lower transit time by 50-70 percent compared to typical operators.
GoBOLT: Using data analytics and IoT, the Mumbai-based startup provides smart logistics solutions like right vehicle selection, route/delivery planning, real-time tracking, reduced transit time and reliable documentation and control, among others.
LoBB: Bengaluru-based SaaS startup Lorry Business to Business, or LOBB provides truck availability information, by region and markets, to transporters, agents and truckers. LOBB provides an app for the agent and the trucker. The agents have all the truckers on the platform, and when the orders appear for the transporter from the brand, they will select the agent and the trucker offering the lowest trip sheet.
According to EY, close to a billion dollars has gone into technology-led logistics companies, but, unfortunately, all of them are still hankering after customer acquisitions.
Mohandas Pai, Managing Director of Aarin Capital, earlier said, “A lot of companies are living off investor money and will take a long time to break even on the B2B side because they are still acquiring customers.”
Of the about 200 logistics startups in the country, only 20 companies have been able to raise large rounds of money. According to YourStory research, logistics only had 28 deals in 2016, and deal sizes were smaller than in 2015. In 2015, ECom Express raised $133 million while Delhivery was able to raise close to $85 million.
Companies like Rivigo and BlackBuck have raised large sums of capital. Rivigo recently raised series D funding of $50 million, taking the company’s valuation to over $900 million. Blackbuck too has already raised $50 million in Series D funding round. Both companies are eyeing to expand their service portfolio.