The problem of empty miles led this founder to launch UAE’s Uber for trucking
Logistics startup Lorryz connects cargo owners with truckers, individuals and companies, allowing them to book trucks to move their cargo in the UAE and Pakistan.
The idea of managing a fleet wasn’t new to Captain Adnan Ahmad. With over 20 years of experience in maritime, shipping, and logistics, he had managed several multimillion-dollar logistics projects across markets.
In 2018, Adnan faced a unique problem. While managing a fleet of trucks in the Kenyan port of Mombasa, he found trucks were returning empty from connected hinterlands due to lack of demand and supply visibility.
When Adnan dug deeper, he realised that close to 35% of the miles travelled by the trucks were without load and damaging the environment.
This problem statement led Adnan to start in 2019. The startup connects cargo owners with truckers, individuals and companies, allowing them to book trucks to move their cargo in the UAE and Pakistan.
“There were problems with demand (shippers) and supply (truckers). In terms of demand, the problems were high transportation costs, unavailability of trucks, inconvenience of managing brokers, lack of visibility, and high brokerage fees. On the supply side, the problems were inconsistent trips, low truck utilisation, and non-payment to customers,” says Adnan in a conversation with YourStory Gulf Edition.
He says over $7 billion per annum is lost due to empty miles, and over 9.2 million metric tons of additional CO2 emissions are due to trucks carrying no load in Lorryz's current and upcoming target markets.
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How it works
Adnan says the idea was to create an Uber or Careem for the trucking industry. In the initial days, the team worked with an MVP, and checked if the market was open to the idea of an Uber for trucks. It took the team a few months to go from the prototype to the product.
The Lorryz product is available on the Playstore and App Store.
The startup helps truck drivers and transportation companies with lead generation, eliminating backhaul waste by matching the right demand and supply, and providing more business and improving the carbon footprint.
It offers real-time tracking and instant pricing along with operational dashboard reports for both cargo owners and truckers.
Lorryz Team
Market and model
Lorryz is B2B-focused and cost-plus business model, which means that it works with corporates only on “huge volume requirements and charge a premium on top of our operating cost”.
Pricing is based on a number of factors, including trip distance, market demand/supply, weight of cargo, truck type etc.
In the first 30 months of the operations, in the last five quarters Lorryz revenue has grown 18% Quarter on Quarter and it shows strong financial and operational performance. Lorryz regional volume moved has now crossed 25,000 plus and the team is serving over 40 B2B customers.
According to a Statista report, the third-party logistics segment is a major contributor to the industry in the Middle-East region, with a revenue of around $42 billion.
A Business Wire report says the UAE is one of the fastest growing countries in the region, as Dubai is a world trade hub and has a strong economic outlook. The report also states that Bahrain offers some of the lowest setup and operating costs for a logistics business, making setting up a business there a lucrative option.
Lorryz competes with other startups like Truckkers operating in the region.
“While other startups are burning at transactional level, we are not as we have always made healthy gross profit margins. We have successfully launched in three markets due to our pre-existing market connections over the years,” Adnan says.
In 2021, the logistics startup raised $1.4 million seed investment from Emirates Investment and Development Center and i-Cell Telecom Group.
Lorryz is now looking to expand its services across the GCC region.
(The story has been updated with changes made to growth figures and numbers, as some of the information was confidential. The image also has been updated in the story)
Edited by Teja Lele