Future of Professional Courier Service in India

The Indian Express Industry or the Indian Professional Courier Industry started in India in the 1980s and has come a long way from deliveries done in days to one day delivery. Since its inception, it has been growing since. The major reason behind the growth in the last 5 years has been the growth of e-commerce business, the rising small and medium-sized enterprises and investor interest in same day delivery start-ups disrupting the on-demand economy. As the industry grows, it becomes important that the companies running in the industry must also grow to sustain themselves and their business. They need to move as per customer demand evolves. Based on the handling of deliveries, tracking and meeting timelines the customer in the future may get willing to spend more on better services.

Deloitte’s report on the Indian Express Industry – 2018 highlights:

• In the next 5 years, the Indian express industry is expected to grow at a CAGR of 17%.

• The contribution of the Indian express industry to the international express industry will be more than 2.5% by 2022.

While there are many delivery services available, the question is are they equipped to deal with the growing expectations from the sector.

There are various types of courier delivery services. How each service performs in the future shall impact the growth of the sector as well as its enterprise. We have analyzed the various types of professional courier services available based on speed, cost, quality, tracking, reliability, handling, and timeliness.

Traditional – The first is the traditional courier and delivery services. They deliver packages either within the domestic territory or they deliver it internationally. They keep the packages to be delivered in warehouses and use hubs to transport from one destination to another before they finally deliver it to the customer.

Challenges

Handling: The greatest challenge is the manhandling of the package. The packages need to be stocked in warehouses and then transported to hubs and then to the final customer. The chances of manhandling are higher in these cases. Especially the fragile packages get affected the most. This leads to the customer receiving damaged or tampered products. Further leading to return courier pick up.

Long timelines: These services bear the warehousing cost but because of the longer timelines they cannot charge more money. They fail to cater to the impulsive buying habits or urgent needs of the growing working population. As per McKinsey’s report "India’s urban awakening: Building inclusive cities, sustaining economic growth", by 2030 India’s working-age population would reach 270 million people.

Tracking: The tracking system is dependent on different personnel working at different levels of the delivery. As a result, the customer is dependent on the courier vendor to get the updated status. The lack of live tracking results in customer dissatisfaction.

Overnight- When the courier pick up happens on T day and delivery happens on T+1 that’s the overnight courier. Just like traditional, overnight courier also keeps the packages to be delivered in warehouses before they transport from one destination to another.

Challenges

Higher cost: Due to the warehousing cost, these services are expensive than the traditional courier services.

Handling: The most common customer complaints are incorrect labeling and delay in deliveries. Warehouse handling is also a setback for delivering fragile goods.

Not meeting timelines: Though they delivery the next day but they do not meet the need for one day delivery. Even for overnight delivery, there are many external factors like traffic, infrastructure, weather that affect delivery timelines.

Postal Services: Indian postal service has the largest network in the world (154,965 Post Offices as on 31.03.2017). Speed Post has the highest pin-code coverage (close to 19,000 pin codes). Though it is the cheapest, but not a professional courier service nor a very fast courier service. The fact cannot be denied that it has its own set of challenges like all other courier services.

Challenges

Speed- The normal delivery speed is slower than other services, but if you want to deliver faster you pay more. Speed post is their fast courier service. However the same can be delayed.

No live tracking - Normal post status is unreliable however for speed post you get status confirmation. Though there is an online platform the status is not live.

Timelines – Normal posts take longer than other private service providers. Also, there is no provision to book courier online.

Handling – There is no proof of delivery in most of the posts.

Same day: Same day courier services send a package from one point to another with one day delivery option. On-demand fastest courier service in Delhi like Pidge provides 60 minutes courier pickup from home and instant delivery. To keep up the task to do same day delivery the courier services face few challenges.

Challenges

Timelines: The timelines are very critical and it becomes imperative to follow the same. If the courier pick up takes the time it will affect delivery. Keeping time track is important because most of the same day services do not have warehousing and keeping a warehouse will be adding to their cost making the deliveries more expensive.

Handling: Most of the courier companies use crowdsourcing for their riders who deliver for them. The absence of accountability that an employee has it becomes critical to drill it down to the riders the need to be customer-oriented. Rather in such cases, it gets easier to get swayed from the objective. The riders might start focusing o making more number of trips than on service.

Change in trends and the future of express delivery

"More than 50 percent of consumers choose delivery options merely based on price while another 20 prefer the cheapest available option of home delivery." (McKinsey & Co Parcel delivery the future of the last mile). However, these trends are going to change in the coming future as more people would like to use on-demand same day courier services.

As per McKinsey & Co Parcel delivery the future of the last mile

For the privilege of same day delivery or instant delivery, almost 25% of consumers are willing to pay significant premiums. And this share is expected to increase because the rising younger consumers are more inclined (just over 30%) to use same day courier services over regular delivery.

The key here would be to work on the customer experience based on handling, tracking, and timelines. On-demand delivery and courier services like Pidge appprovides an exceptional experience at the tap of a button. The future lies in working on technology providing the most effective online courier service to leverage the growing digitization of India. Consumer behavior can only change by innovation in the field of technology.