The document discusses the opportunity for electronic logistics marketplaces in India. It notes that India's growing economy and manufacturing sector are increasing demand for efficient logistics. However, the logistics industry in India remains fragmented with low visibility and high costs. The emergence of technologies like the Internet, smartphones, and data analytics present an opportunity to create electronic logistics marketplaces that connect shippers and carriers to improve efficiency. Such marketplaces could offer services like freight booking, tracking, payments, and optimize capacity utilization through real-time information. They represent a chance to overcome challenges in India's logistics industry and capture its significant growth potential.

1. END TO END ELECTRONIC LOGISTICS
MARKETPLACE
THE NEXT BIG OPPORTUNITY IN INDIA
KISHORE KUMAR
MARCH, 2017
(INTERNET RESEARCH)

2. #1 Robust Policy Framework
#2 Strong Infrastructure
#3 Manufacturing for future
#4 Efficient Logistics
4 PILLARS OF ECONOMIC GROWTH
IN INDIA

3.  India pursuing comprehensive economic reforms through
Privatization; Liberalization and Globalization policies since 1991
 Increasingly allowing Private sector and Foreign Investment in
manufacturing sector
 Under current NDA regime- Make in India and Skill India
initiatives- greater emphasis on manufacturing and also aligning
workforce to future needs of industry
ROBUST POLICY FRAMEWORK

4. INDIA’S ECONOMIC GROWTH

5.  Backed by India’s demographic potential, urbanization,
economic growth and labor force- manufacturing and logistics
sectors are poised for accelerated growth.
 India’s GDP growth is forecasted to grow at a rate of 8.2% from
2015 till 2035 to reach 10 Trillion USD.
 India’s share of world economy is forecasted to increase from
current 2.8% (2015) to 7.5% in 2035.
INDIA’S ECONOMIC GROWTH

6. RISING INVESTMENT IN INFRA
SECTOR

7.  Investment in Infrastructure is the prime focus of Indian govt.
 About 10% of India’s GDP is planned to be invested in
Infrastructure sector
 This rate of investment is higher than in any BRIC country and
also USA and Japan.
RISING INVESTMENT IN INFRA
SECTOR

8.  Logistics is “that part of supply chain process that plans, implements, and
controls the efficient, effective, forward and reverse flow and storage of
goods, services, and related information between the point of origin and
the point of consumption in order to meet customer requirement.
 Simply put - right product, at the right place, in right time, and in right
condition.
 SCM: Supply Chain Management is the oversight of materials, information
and finances as they move in the process from supplier to manufacturer to
wholesaler to retailer to customer.
 Simply put- SCM =
Logistics+Sourcing+purchasing+Procuring+Operations+Planning
LOGISTICS AND SCM

10.  Logistics is a critical enabler of India’s Economic Growth
 Currently Logistics contributes to 13% of National GDP and is valued at USD
300 Billion.
 It is expected to grow at a CAGR of 12.17 from 2015 to reach a level of 462
billion USD by 2020.
 In USA, this share is just 8.5%. As Logistics becomes more efficient, its share
in GDP falls
 Thus, there is tremendous scope for efficiencies in this sector in India
through capital investments and also technology adoption.
ROLE OF LOGISTICS

11. CONTRIBUTION OF LOGISTICS TO GDP
INDIA, CHINA & USA

12. COMPARISON OF MODAL MIX- INDIA & CHINA

13. DRIVERS OF LOGISTICS GROWTH IN INIDA

14. CHALLENGES IN LOGISTICS

15. CHALLENGES IN LOGISTICS

16.  Logistics sector in India is extremely fragmented involving an array
of participants:
 Shippers (manufacturers, retailers, distributors) who make or
sell the products that need to be stored or moved,
 Logistics service providers (LSP) (third-party logistics providers
(3PLs), 4PLs, freight forwarders, ocean shipping, trucking, rail, air
cargo, storage) who store and move products,
 Logistics hubs (airports, sea ports, rail terminals),
 Regulatory authorities (customs).
FRAGMENTED INDUSTRY

17.  From pickup to the final delivery, shipments and consignments
change a lot of hands e.g. if a shipment was picked by Company
A, it would be transited to the next hub by Company B and then
delivered by Company C.
 Integration of systems across so many companies gets
challenging leading to almost zero visibility over delivery
networks.
 Executives and workers are left with no option but to manually
call up every individual participant of the delivery chain to check
on the status of their shipment
LOW VISIBILITY & NO TRACKING

18.  Presence of many layers between supplier and end customer,
poor processes, lack of standardization, traditional business
models result in high costs and cost fluctuations.
 Low technology adoption currently is also an area of concern
 Poor infrastructure, high turnaround time,
HIGH & FLUCTUATING COSTS

19. TYPICAL PROBLEMS IN LOGISTICS

20. TYPICAL PROBLEMS IN LOGISTICS

21.  Technology is disrupting many traditional sectors of the Indian
Economy
 The rise of IT services and penetration of Internet are the driving
forces
 Disruptions are very evident in telecom, consumer, media, financial,
travel, entertainment and many other sectors
 These disruptions are bringing about changes in core processes,
efficiencies in cost, customer acquisition and distribution, and may
well replace core parts of traditional value chains
RISE OF TECHNOLOGY AND DISRUTPION OF
TRADITIONAL SECTORS IN INDIA

22.  What makes logistics sector so attractive for technology
deployment:
Logistics is the backbone of global trade, but at the same time has
been a fragmented industry and a slow adopter of new
technologies. The underdeveloped market potential along with the
potential of harnessing technology to meet this need make this
industry a target for disruption.
TECHNOLOGY & LOGISTICS

23.  Rapid growth of Economy requires a growing Logistics industry.
 Logistics industry estimated to grown from current 300 Billion USD at a
CAGR of 12% till 2020
 Pressure on costs, time and scale call for value driven solutions in Logistics
space.
 Rapid growth of enabling eco-system – Internet, Smart phones, Cloud and
Big data /Analytics
 Falling prices of hardware, software and data
 Startups harnessing opportunity aided by VC Funds
 Rise of E-commerce has led to a shift in the way logistics perceived in India
with emphasis on shorter delivery times and online tracking of deliveries
INDUCTING TECHNOLOGY TO LOGISTICS

24.  Efficiency Gains – Significant gains happen when old, manual processes are
performed by new system functionality or are totally eliminated by a new
way of working within a software application. More efficient logistics
operations allow companies to lower costs and operate with greater
efficiency.
(Typical areas of efficiency are disintermediation of brokers ( which
reduces costs) , aggregation of shipments, and Software-as-a-
Service (SaaS) replacing antiquated processes, reduction of vacant return of
vehicles etc.)
 Competitive Advantage – These systems allow companies to offer a higher
level of customer service through better communicate and issue
resolution. Disruptions and issues are resolved faster compared to
competitors who rely on manual processes.
 Responsiveness – Logistics systems create a flexible supply chain. Here,
multiple parties communicate easily as freight moves and collaborate on
how to best overcome challenges while still meeting customer’s
expectations.
BENEFITS OF LOGISTICS TECHNOLOGY

25.  Compliance – A company is assured of performing its due
diligence to meet government requirements (import/ export,
screenings, classifications, etc.) with automated processes
provided within the system.
 Analytics – Reporting becomes standardized, on time, and in
most cases on demand. With the system stored data, analysts
can mine trends, identify recurring problems, and uncover cost
savings that are missed with manual data collection methods.
BENEFITS OF LOGISTICS TECHNOLOGY

26.  Big Data:
The movement of goods and the management of
numerous SKUs (Stock-Keeping Units) require efficient handling of
the associated data during the logistics process. This is
something that can be (and is already being) made much
simpler by involving the use of serious data crunching and data
analytics prowess.
TECHNOLOGIES THAT WILL ENABLE OVERCOME
CHALLENGES IN LOGISTICS

27.  Automation & Robotics:
Automation is basically the setup of processes in such a
way that certain triggers set off stages of the process
automatically without the need for human intervention.
Essentially, all automation processes must be monitored by
capable logistics technology solutions to aid efficiency.
TECHNOLOGIES THAT WILL ENABLE OVERCOME
CHALLENGES IN LOGISTICS
(SOURCE=QUICKHOP)

28.  AIDC/RFID (Automatic Identification and Data Capture):
These 2 technologies are yet to reach the level of utility and
implementation that can realize their full potential. But, if the
current situation is anything to go by; in the coming years, we
can see an expanded usage of Radio Frequency
Identification and Automatic Identification & Data Capture in
gateway passage of cargo, loading/unloading checks, and
identification of details of the goods that move into a warehouse.
 IoT ( Internet of Things)
 IOT refers to the network that allows various digital and/or electronic
devices to connect amongst themselves and thus allow for easy data
transfer.
 (IoT) has potential to connect virtually anything to the Internet and
accelerate data-driven logistics. It is estimated that by 2020, more than 50
billion objects will be connected to the Internet, presenting an immense
$1.9 trillion opportunity in logistics. New dedicated IoT networks such as
LoRaWAN™ are emerging to increase the speed of IoT adoption.
TECHNOLOGIES THAT WILL ENABLE OVERCOME
CHALLENGES IN LOGISTICS
(SOURCE=QUICKHOP BLOG)

29.  GPS-related Refinements & Innovations:
GPS, an acronym for Global Positioning System, can help in
getting rid of some of the biggest pain points of the logistics
industry. But, it’s not just about GPS, which, in its core
form, has been in utilization for over a decade. Various
positioning mechanisms have evolved and improved and have
taken GPS functionality to the next level and have helped
transform logistics technology.
TECHNOLOGIES THAT WILL ENABLE OVERCOME
CHALLENGES IN LOGISTICS
(SOURCE=QUICKHOP BLOG)

30.  Electronic Logistics Marketplace (ELM) refers to an
electronic hub using web-based systems that link
shippers , carriers and customers together for the
purpose of collaboration/ trading and facilitate flow
of information between the three parties involved
through the use of information and communication
technology (ICT).
LOGISTICS MARKETPLACES

31.  Mega opportunity area in India which has fast growing logistics demand
on one end a highly fragmented, unorganized, non-transparent, low tech
logistics service providers (LSP) market on the other end.
 Technology and Internet based Startups are disrupting traditional LSPs
in following ways:
1. Creating on-demand marketplaces that address information
asymmetry and facilitate price discovery. These models drive
efficiencies through dis-intermediation and by increasing
utilization levels.
2. Adopting core innovations like sensors, telematics and analytics.
Through real-time tracing, demand visibility, route optimization
and proactive maintenance these technologies help streamline
logistics operations.
LOGISTICS MARKETPLACES
LEVERAGING TECHNOLOGY TO OVERCOME CHALLENGES

34.  Large, established companies are often left with legacy IT systems
that make globally streamlined IT services difficult to achieve.
 Logistics startups are focusing on owning the ‘logistics interface’,
creating online marketplaces that connect logistics demand with
supply yet owning none of the assets and infrastructure.
OPPORTUNITY SPACE FOR LOGISTICS
MARKETPLACES

35.  Digital platforms enable real-time quotes and flexible execution of broker deals
 Easier access to a broader customer base online
 Flexible sourcing of externally operated services instead of long-term partnerships
and dependencies
 Optimized capacity utilization, acquisition of additional capacity, and reduction of
empty rides
 Increased price transparency through multiple comparisons on the digital
marketplace
 Enables organizations to take control of its supply chain in order to
increase oversight while also securing and maintaining internal synergies.
KEY BENEFITS OF ELM

36.  Ocean Freight
 Air Freight
 Trucking & Delivery
 Government Agency Filings
 Customs Clearances
 Customs Bonds
 Product Classification
 Cargo Insurance
 Quality Inspections
 Warehousing and Fulfillment
 Document generation/ management ( contracts, invoices, payments etc)
 Standardization of quotes
 Comparison of quotes
 Auctions
 Ratings of participants ( to facilitate choice- all players- shippers, transporters-customers)
 Payment gateways and settlement
 Performance measurement
 Algorithmic matching
SERVICES OF END-TO-END ELM

37.  Transportation Planning and Execution, mode
selection, carrier selection, rating, match-
pay/auditing, reporting, dashboards, Google Map
visibility, alerts, instant messaging, POD signature
capture, pickup and delivery appointment scheduling,
claims photo capture with forms attachment,
vendor/carrier/customer portals, API connections to
3rd party systems, and EDI broker for carrier and
customer integration.
SERVICES OF END-TO-END ELM

38.  Unsolved security, insurance, liability, and fraud issues
 Difficulties in guaranteeing the quality and availability of carrier
capacity
 Forwarding business is potentially too complex to auto- mate via
an online marketplace. Eg. Customs clearing in destination
country case of exports. Hence, apart from software, human
intervention is required for such services. Flexport (USA) is one
such example where such seamless service is offered for
international shipping.
KEY CHALLENGES FOR ELMs

40. GLOBAL DEALS AND FUNDING TREND IN SCM
AND LOGISTICS SPACE

41. LOGISTICS MARKETPLACES IN INDIA
INDIA
STATE OF PLAY

42. 3 BROAD AREAS OF OPERATION:
 #1: TRUCKING TECH
 #2 HYPER LOCAL
 #3 FULFILMENT SERVICES
LOGISTICS MARKETPLACES
STATE OF PLAY IN INDIA

43.  Loadboards: online listing platforms that allow shippers and
brokers to post loads and carrier information. These models enable
discovery and are usually subscription led
 Freight marketplaces: online managed marketplaces that match
demand and supply of freight in real-time. These models improve
utilization and usually transaction-led.
 Freight exchanges: online marketplaces that focus on the inter-
modal and international freight segment. They connect shippers
with freight forwarders and are entirely subscription led. Examples
in India
 E Cargo.in
 Shipping Exchange
TRUCKING TECH
LONG HAUL MARKET PLACES
( SOURCE: AVENDUS RESEARCH)

44.  2 MAJOR SEGMENTS
 LONG HAUL ( INTER-CITY)
 Most of the start-up action has been in the long-haul freight marketplace
segment
 Benefits offered: faster transactions/ efficient spot pricing/standardized
service levels and agent dis-intermediation.
 A conservative 2% commission rate assumption yields a $0.04 billion market
opportunity today.
 It is likely to grow to $0.74 billion by 2020.
 Examples of players in this segment
 Blackbuck Rivigo
 TruckSuvidha Freight Tiger
 Dipper Return Trucks
 GoBolt Cargoexchange
 Truck Mandi
 The Porter
TRUCKING TECH
Loadboards and Freight Marketplaces

45.  SHORT HAUL ( INTRA-CITY)
 On-demand freight marketplaces connecting shippers with
local small carriers.
 The monetization structure is similar to that of taxi aggregators
and their key value proposition is improvement in utilization
rates.
 Cater mostly to e-commerce companies (70%)
 Retail business comprises of rest 30%
 M&M has also entered this segment with SmartShift
 Other players in this segment
 Blowhorn Shippr EZMove
 Moovo LetsTransport Trucksumo
TRUCKING TECH

46.  Businesses that make local delivery of on-line orders within
a limited geography
 3 sub categories
#1 First and Last Mile:
Examples: Bluebirch / PARSEL
#2 B 2 C
Examples:
Zomato/Gofers/Swiggy/Faasos/Runnr/Zopper
TheKarrier/ Vdeliver (Hyd)
#3 B 2 B
Examples: Shadowfox/Opinio
HYPERLOCAL

47. PROFILES OF FEW HYPERLOCAL STARTUPS

48. TOP INNOVATIONS OF HYPERLOCAL
STARTUPS

49.  End-to-End fulfilment ( First Mile – Line Haul – Last Mile)
 Entire gamut of services like warehousing, packing, sorting,
delivery, return logistics
 Asset Heavy
 Current market size estimated at 1.2 billion USD. Growing to 6
Billion USD by 2020
 Players in market
 Ecom Express Holisol
 Delhivery Fedex
 Gojavas Gati
 Expressbees Ekart
FULFILMENT SERVICES

50.  LOADBOARDS
 Listing of carriers and Search options for Shippers. Similar to
Yellowpages
 FREIGHT MARKET PLACES
 Eliminates need for freight brokers to source business
 Improves truck utilization by reducing/avoiding empty return of
trucks
 Additional benefits of truck tracking, invoicing, quick payment
settlement, tie-ups with petrol stations /insurance for discounts
 How to pack – increases packing efficiency of container/truck using
online 3D modeling.
 FREIGHT EXCHANGES
 Still in infancy as enablers are not yet fully evolved as in developed
countries
 This can be explained by low adoption of technology by
infrastructure providers and port terminal/air cargo and related
authorities. Apart from this, inter-modal in-land transport is very
miniscule in the country affording little opportunity for growth
VALUE PROPOSITONS

52. BENEFITS OFFERED BY STARTUPS

53. ONLINE PACKING ENGINE TO INCREASE
PACKING EFFICIENCY OF
CONTAINER/TRUCK

54. MOST FUNDED LOGISTICS TECH
FIRMS IN INDIA
2015 2016

55.  Most of the current breed of logistics startups and market
places are focused on one aspect of logistics – such as –
truck freight; small trucks, inter-city; intra-city; E-commerce
oriented; ocean freight etc and that too in limited
geography.
 Single marketplace offering solution to entire logistics
chain- both domestic and international- with end-to-end
service starting from quotes to delivery including
documentation , rating of players, risk mitigation, pan-India
presence is not present. Perhaps, this is an opportunity
area.
UNSERVED MARKET IN INDIA

56.  1) Forget Innovation, Just Execute Better:
Companies should just focus on executing better with the
systems and processes they already have in place than try to
chase the next technological or process innovation.
 2) Collaborate with Parters:
-Technology is not a silver bullet cure. If you’re not “walking
the talk” on collaboration with external partners, and if you’re
still dealing with data quality problems, chances of failure are
many.
3) Success Mantra - Enhanced evolution is a better strategy for
success than radical revolution.
 (Experience of dotcom era shows that if aim of a startup is to
revolutionize a supply chain process — that is, completely
transform the way it is managed today — chances of failure
are high.)
PATHS TO PROFITABILITY

57.  Slowdown in China
 India attractive country for manufacturing
 Indian Govt- Make in India campaign
 Huge increase in project imports into India
 Margin Squeeze
 Freight rates are lowest now
 Intense competetion
 Arbitrage non-existent as internet penetration has increased price
transparency
 Global E commerce players to enter India
 Alibaba has large plans for India
 Many international E com players to enter India
 Indian Govt. pro-active policy in favor of E commerce
GLOBAL TRIGGERS INFLUENCING INDIAN
FREIGHT INDUSTRY

58.  GST
 With imminent roll out of GST , Logistics is positively impacted
 Disparate state laws will now become uniform and encourage
companies to outsource logistics function to 3 rd parties
 Convenience of Parcel like forwarding
 Tracking of shipments akin to Parcels is now feasible with
technlogy
 Customer convenience is enhanced with visibility through tracking
 JIT
 Just In Time inventory sought by shippers is forcing logistics
providers to become more efficient and integrated.
GLOBAL TRIGGERS INFLUENCING INDIAN FREIGHT
INDUSTRY

59.  M & A in shipping industry
 1. French Liner CMA CGM’s acquisition of Singapore’s APL
 2. Cosco and China Shipping’s (CSCL) merger
 With these changes, the new alliance structure would be like:
 2M (Maersk, MSC); G6 (OOCL, Hapag-Lloyd, NYK, Hyundai, MOL,
Hamburg Sud); KYHE (“K” Line, Yang Ming, Evergreen, Hanjin);
and 05 (CMA CGM, CSCL, UASC, APL, Cosco).
GLOBAL TRIGGERS INFLUENCING INDIAN FREIGHT
INDUSTRY

60.  Logistics market booming in India with great future potential with both
domestic and global triggers.
 Logistics industry offers excellent opportunity for technology
intervention
 Technology will dramatically change the way the traditional logistics
business is carried through efficiency improvement, visibility, tracking,
cost reduction and enhanced reliability
 Many startups in logistics space but with limited geography coverage
 Value proposition ranges from cost savings, reduced wastage of time,
better utilization of assets, tracking, and disintermediation of brokers.
 Logistics supporting Ecommerce is the biggest change in India
 New developments in technology such as IoT; RFID; Geo-tagging;
Robotics, Big Data; GPS will further enhance logistics capabilities.
 Enormous opportunity for a pan-India, end-to-end , domestic and
international markets servicing marketplace
 Sole reliance on Technology alone is not a success factor. Integrating
Humans with software and relationships with various players in the
supply chain is the only path to profitability.
END NOTE

61. ANNEXURES

62. ALEXA TOP 10 LOGISTICS SITES IN THE WORLD

63.  FOR FREIGHT RATES
 FREIGHTOS
 I CONTAINERS
 XENETA
 LOGISTRADE
 CARGOHOUND
 FOR END-TO-END OCEAN SHIPPING
 FLEXPORT
 FOR MONITORING
 CARGOBEACON
LIST OF PROMISING STARTUPS
INTERNATIONAL

64. LIST OF PROMISING LOGISTICS STARTUPS IN
USA & THEIR SPECIALIZATION AREA

66. 2016 HOTTEST SECTORS IN INDIA BY VC
ACTIVITY (Source: TRACXN)

70. LOGISTICS THEMES VCs ARE EXCITED TO
INVEST (SOURCE : TRANCSN)

72.  India's Hottest Tech Sector 2017.pdf
 Global-Hottest-THEMES VC ACTIVITY.pdf
 Funds raised by logistics firms-Year wise.docx
 20 Top SCM companies India 2017 - CIOReview India
Magazine.pdf
INDIA SPECIFIC DATA ON LOGISTICS

73. LOGISTICS STARTUPS THAT DID NOT
SUCCEED
6 LOGISTICS STARTUPS THAT
CLOSED
 TheKarrier
 Truckmandi
 Trucksumo
 Loadkhoj
 Zaicus
 Sastabhada
All dealing with truck aggregating
for intra as well as inter-city transport
 TinyOwl – Food Delivery
 Peppertap – Grocery Delivery
 Ola Café- Food and Grocery Delivery

74.  Fragmentation of the Indian logistics sector and the inability of
technology alone to resolve the brick and mortar business
 Credit-driven business which made it difficult to scale up. (35-40
days’ credit).
 The identified pain-point of “requiring the truck on demand” –
which was the business premise- was not a reality
 A number of such start-ups failed because they did not take a
full stack view of the Indian logistics sector. Just adding a thin
layer of technology does not solve the deep routed problems
such as non-availability of drivers and fragmented truck
ownership.
 Key issues of both Shipper and Service Provider not addressed
fully
 SHIPPER : High freight rates when benchmarked against global
standards and non transparency of transactions
 SERVICE PROVIDER: Bill reconciliation with clients and idling of vehicles
without load
REASONS FOR FAILURE

75. 2017 is set to be a landmark year for logistics in India.
With the introduction of GST and a major push towards
a digital, cashless economy, we can expect significant
buzz and traction for technology enabled logistics
startups. However, while the opportunity is huge, only
a handful of very resilient companies that are creating
real value in the market will survive the year going into
2018.
OUTLOOK