Snapdeal to make it mandatory for logistics partners to integrate with its technology platform

NEW DELHI: Snapdeal plans to make it mandatory for logistics partners to integrate with its technology platform. The ecommerce firm, which has invested $300 million (about Rs 2,000 crore) in logistics tech in the past two years, is building a plug-and-play online platform to facilitate integration and cut down dependence on manual procedures as it prepares to ramp up delivery capacities up to 20 times.
The platform is currently in the testing phase and will go in for a full-blown scale-up soon, Snapdeal’s chief customer experience officer Jayant Sood said.

The company works with about 15 partners across 46,000 pincodes.

Snapdeal’s arch rival Flipkart, which is expected to spin off its logistics vertical EKart into a separate vertical, invested close to $100 million (about Rs 667 crore) in technology early this year while Paytm hinted at plans to double investment in logistics network to Rs 500 crore this fiscal.

As consumer demand now emanates from across the hinterland and far-flung areas, Snapdeal is increasingly banking on regional logistics players who cater to deliveries in such areas but are low on technology. "We don’t have a single partner who covers the length and breadth of India and that is the reason why last-mile logistics still remains highly fragmented. As we plan to get to the depth of India, we need to partner with a whole lot of regional partners," said Sood.

Most of the smaller regional lastmile players operating in tier-III towns or rural areas do not have the financial muscle or capability to invest in technology, Sood said. "But at the same time it’s very, very critical for us to maintain end-to-end visibility in terms of where the pack-et is at any point of time to maintain delivery timelines," he said.

When the platform is rolled out, Snapdeal will make it mandatory for all logistics partners to integrate with the online platform so as to work with the company. The service will come free of cost to its partners. Currently individual integration with delivery partners happens on an API (application program interface) to API basis and since different players have very different APIs, integration takes up to a couple of months to complete.

The platform in the works can reduce the time taken to a week, especially for smarter partners who have some exposure to technology in their operations. Snapdeal has also created an app that will be given to partners and they will be able to use it not only for Snapdeal but also for their operations with other ecommerce companies.

The plug-and-play tech solution will enable smart management of peaks and troughs in demand by smartly allocating volumes, based on a partner’s capacities, according to the company. It will also help manage new products such as the recently launched four-hour delivery service for shipment of fast-moving consumer goods in Delhi. In the coming months, most of Snapdeal’s first-mile operations will be controlled by Vulcan Express, along with a couple of other large firms.