Ekart's kirana strategy to boost Big Billion Days

By Alnoor Peermohamed , Business Standard, Bengaluru | In Digital | September 30, 2016
The logistics arm of Flipkart has tied up with 1,200 local stores to enable last-mile deliveries.

India's largest e-commerce marketplace Flipkart's logistics arm Ekart has tied up with about 1,200 kirana stores across the country to enable last-mile deliveries and store pickups during its coming Big Billion Days sale.

Flipkart, which expects daily business to quadruple in the five-day period starting October 2, has been working on testing its new last-mile delivery mechanism for the past eight months. The company said the new arrangement would allow it to deliver products in smaller towns, where Ekart doesn't have a big presence.

The company also said its new last-mile delivery model would allow it to forgo hiring a large temporary workforce, who would have to be trained in advance. The process would now be a lot more cost effective.

For kirana stores, they can utilise the space manpower capacity, usually in the middle of the day. This has encouraged them to tie up with Flipkart. "A lot of work has gone into ensuring we have enough capacity to get orders delivered on time," said Neeraj Aggarwal, vice-president, operations, Flipkart.

There are some teething problems still. Aggarwal said customers were making purchases even 10 days before Dussehra (October 11). "People may not be available at this point to make deliveries."

Business Standard had reported on September 17 that e-commerce firms are staring at a shortage of delivery staff, as they compete with offline retailers.

Flipkart and Snapdeal have previously said they would hire 10,000 temporary workers each to deal with the spike in deliveries during their festive season sales.

Sources said kirana stores, temporary delivery staff and in-store pickups at outlets of Apollo Pharmacy will account for between 20-25 per cent of all deliveries made during this period. While the sale lasts for just five days, Ekart's delivery staff would be handling 2.5 times the average number of daily orders for a period of 10-12 days during and after the Big Billion Days sale.

Apart from partnering with kirana stores, Ekart has also tied up with a similar number of local agencies that will provide it with manpower. The combined strength of delivery personnel, the company claimed, would be close to 10,000, augmenting Ekart's strength to around 30,000 people.

"One of the things we've done this year in a very big way is to build this variable delivery stack or alternate delivery model. So you live close to a kirana store. Your locality gets 30-50 parcels a day. We'll hand over these parcels to these stores to go do the last-mile delivery for us," said Aggarwal.

In the past three months, Ekart has been able to increase the number of pincodes it services to 5,000 from 3,800, through such last-mile delivery mechanisms. For Flipkart, the mechanism was here to stay.

The logistics firm services partners such as Jabong, Myntra, Voonik, Hopscotch, Reliance and Madhura.

"The idea is to provide them with the same service and capability that we'd provide to Flipkart. If they, too, are going to see a spike in demand, then we're going to fulfill their demand," said Aggarwal.