The global contract logistics company DHL Supply Chain launched its India Fulfilment Network (IFN), in Bangalore and announced that it will invest more than ₹25 crore to further scale this network across major metros and state capitals in the country over the next 12 months.
“This first-of-its-kind service will be rolled out to benefit the growing number of small and medium retail businesses that have seen a shift in their business models to online marketplaces, largely spurred by movement restrictions caused by the ongoing pandemic,” reads the release.
The IFN is a launchpad curated for easing the B2C fulfilment process. It is a 360-degree supply chain solution for enterprises across sectors, allowing them to manage their immediate operations seamlessly in a fully online marketplace scenario. In addition to this, the IFN also offers transportation linkages to customers, providing last-mile delivery services to further bolster their independent dot.com models. DHL’s sites are located in proximity to the major urban centres, offer SMEs a multi-user network solution with access to its established services that would support them across the entire supply chain.
This ‘plug and play model that provides end-to-end tracking and monitoring will enable merchants to directly sell their products across the whole country, leveraging DHL’s network without having to make huge investments in infrastructure and IT.
The IFN will help power Indian businesses’ e-commerce business models by providing access to omnichannel distribution capabilities across key markets.
Vikas Anand, Managing Director, DHL Supply Chain, India, said, “Ultimately the IFN allows SMEs to take advantage of DHL’s scale in a way that is flexible and tailored to their needs.”
“We can support customers across the entire supply chain – from inbound handling and storage, pick and pack, last-mile delivery as well as handling returns, which will help accelerate and standardize delivery times for their end consumers,” he added.
Additionally, with its “Pay-per-use model”, the IFN also gives large retailers and big brands the option to de-risk their supply chains by having access to e-fulfilment hubs across the country, which would be in addition to their main distribution centres. This would ensure their sales and distribution channels are less impacted in case of local lockdowns.
The note also reads, “DHL’s innovative approach will level the playing field between SMEs and multinational e-commerce giants who can afford to operate in multiple markets and commit to next-day deliveries - fast becoming the industry standard and an expectation of consumers. With DHL’s Radio Frequency (RF) enabled infrastructure along with a robust IT platform linked to marketplaces and delivery partners, organizations can also tailor the service to specific regions within the country, as well as scale up to match order volumes.”
Even before the pandemic, the opportunity in the e-commerce market in India has been evident and is expected to grow at a CAGR of approximately 27 percent by 2024, with a large number of sellers in various categories showing a keen interest in shifting to an omnichannel model. The e-commerce boom during the Covid-19 pandemic has further boosted online retail transactions across India, especially with government-imposed social distancing protocols and a resultant decline in customers at brick and mortar shops. Relatedly, the expansion of e-commerce and 3PL sectors is also fueling demand for warehousing, which is expected to increase at 160 percent.