Courier Services: How Aggregators Handle Your Packages?

Image Source: India Filings

The logistics companies in India have benefitted immensely, since the implementation of Goods and Services Tax (GST). The introduction of this tax has permitted the logistics industry to improve profit margins by reducing costs and optimizing their warehouses. The introduction of GST has made the tax structure uniform for the entire nation, which means that aggregators do not need to pay indirect tax and varied rates of taxes in different states of the country. This has effectively made the structure of inter-state logistics less costly and cumbersome.

FMCG giants in India are the driving force behind the expansionary policies for the growth of e-commerce sector. The impetus by the FMCG giants and the rising demand for e-commerce courier services has helped in leaps and bounds to logistics aggregator start-ups. The stairway to growth for logistics aggregators is however, filled with challenges to meet ever-increasing demands for quick delivery and efficient services.

Numerous start-ups have started rising in India to serve as logistics partners. The e-commerce industry’s heavy reliance on logistics aggregators have fueled the rise of such start-ups. However, the industry also needs as many aggregators as it can get since without aggregator firms and their cost-effective as well as speedy deliveries, the e-commerce industry would collapse and crumble.

Indian consumer start-ups have developed a new playing field called as “selling convenience”. An array of start-ups are providing courier services to prevent consumers from the inconvenience of going to the courier agency. Start-up companies such as Pigen, ShipTickr, DaakNinja, Parcelled, Shipsy, Shipping101, Shiprocket, Pickrr — are offering services including packaging, shipping, and tracking of parcels till the time it is delivered to the desired location. These new start-ups are offering these services at half the prices being quoted by well-established players such as Bluedart, DTDC and DHL, and are thus operating as effective courier aggregators.

These new logistics firms are constantly innovated themselves in order to keep up with changing consumer demands and evolving technologies. The demand for lower costs, faster shipping and greater reach will never cease, and companies are renovating themselves to meet and exceed customer expectations. Order tracking functionality, has garnered positive reviews from their customers, since it allows them to track their shipment in real-time till the time it is delivered to the desired location.

The major services offered include:

  • Warehousing
  • Transportation
  • Freight forwarding

These three services form the core of any e-commerce business across the globe. These services help companies in the e-commerce industry to reach new customers in different geographies, and ensure safe delivery of goods or products in a timely fashion. Having an efficient logistics partner, thus, helps e-commerce companies to enhance customer satisfaction.

Role of Aggregators in handling your packages

  • Taking the fast growth of the logistics industry into consideration, it has become highly important to understand the role of logistics aggregator firm in e-commerce space and their operating procedures. A regular logistics service provider offers shipping across the nation as well as across the world.
  • A dedicated group of employees is responsible for storage, transportation, and the related processing of operational components. These employees are assigned the task to sort the products of consumers into pre-decided categories by the firm, and store them accordingly to facilitate a systematic and speedy delivery of goods. Similarly, there are various groups of employees involved in the safe delivery of goods to the location of customers or end-users. Once the task from picking up the products to final delivery of it to the desired place is accomplished, the aggregator is awarded a commission for the services.
  • Courier services have several operational fulfillment centers and warehouses across the nation. These entities are the responsible for safe storage of the products, packaging, and the final delivery process. Aggregators charge a processing fee for the logistics provided by the fulfillment centers and warehouses for safe and timely delivery of products.

Reason for hiring aggregators

Hiring aggregators becomes imperative when you have or own an e-commerce company. The growing expectations of consumers regarding, faster delivery times, cost-effective shipping, and safe delivery of packages, makes hiring aggregators all the wiser. To grow a business, retain existing customers, and acquire new ones, one must learn about aggregator’s courier services, to evaluate which package suits them the best.

Having the right partners, helps a business elevate customer satisfaction as well as increase profitability. Aggregators can assist an e-commerce company in freeing up their time and resources, which can be employed to focus on providing better services and manufacturing better products. The free time also allows companies to focus on their strategies and work towards their vision aggressively. Owing to the advantages of improvement in operational efficiency and optimization of their supply chains, many e-commerce organizations are opting to collaborate with courier services.

In addition to the aforementioned advantages, hiring an aggregator comes with numerous benefits, to enhance the operations of a business and help it grow further. Some of the benefits are as follows:

  • Low investment on systems
  • Reduction in logistics cost
  • Reduction in distribution infrastructure
  • Reduction in liabilities and freight costs
  • Leveraging economies of scale
  • No need to maintain a fleet
  • Enhanced performance
  • Cost-effective scaling of labor resources
  • Improved accessibility to new markets
  • Efficient management of fixed and variable costs

Apart from the advantages/ benefits of hiring courier services, they come with certain characteristics, which are beneficial to an e-commerce business in improving their customer experience. Enhanced customer experience helps e-commerce businesses earn the loyalty of existing customers by creating a lasting impression, and at the same time gain new customers. Some of the characteristics, which third-party aggregator firms bring in, include:

  • Effective department of support
  • Greater reach in the nation and across the globe
  • High quality of database and logistics software
  • Skilled personnel
  • Insurance packages for products/ goods being shipped
  • Safe packaging
  • Hassle-free return facility
  • Timely pick-up and drop-off of products
  • Array of payment options
  • Faster product delivery

With faster product delivery, timely pick-up and drop-off, customers also need to know where their package/ shipment is in real time. Order tracking is such a service to provide customers with required information regarding their products. A service like this enhances transparency of the operations, and assures safe handling of products to customers.

Hence, having an aggregator as a partner will immensely help an e-commerce business to enhance their operations and at the same time minimize expenses. Most productive logistics organizations have dedicated operations and engineering teams, which continuously evaluate and automate logistical processes and systems. Collaborating with a third-party logistics aggregator thus, helps an e-commerce business to free up time and resources, which can be better utilized to concentrate on the core structure of their business. This in turn allows the e-commerce companies to improvise and enhance their offerings and over time attract more customers.

Final thoughts

“All we are doing is looking at the time line, from the moment the customer gives us an order to the point when we collect the cash. And we are reducing the time line by reducing the non-value adding wastes.”Taiichi Ohno, father of Toyota Production System (TPS)

The supply chain management process is neither straightforward, nor simple. Setting up a dedicated logistics department may be too costly to be feasible for small online companies and businesses. In this situation, hiring a third-party logistics aggregator firm can be beneficial and wise. Hiring a third-party logistics aggregator firm prevents a business from spending time on issues and problems associated with logistics, and concentrate toward enhancing and improvising their key deliverables. This give an e-commerce business the breathing room to form strategies and pave ways to grow their business as per their vision.

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Abhilash Khalkar

Abhilash Khalkar

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Abhilash, a serendipitous writer, aims to create an impact in this world with his writing. He enjoys espressos, as should all right-thinking people.