Hyperlocal Is The Way To Go For​​​​​​​ Logistics

Hyperlocal logistics is about getting a product in 24 hours, 4 hours or 45 minutes, to smaller towns where the majority business of e-commerce is generated. While many hyperlocal logistics firms failed since 2014, there are many innovative ones that are redefining how business is done in the segment with the back-up of technologies driven by machine learning, predictive analytics and artificial intelligence.

- Nahida Jafferi

India’s logistics sector is estimated to be worth $307 billion by 2020, mainly driven by e-commerce, retail, and manufacturing. The Indian e-commerce is growing at 30 percent per year and in the last five years, the Indian logistics industry has grown at a compound annual growth rate (CAGR) of 7.8 percent.

The Global Ranking of the World Bank’s 2016 Logistics Performance Index shows that India jumped to 35th rank in 2016 from 54th rank in 2014 in terms of overall logistics performance. India’s e-commerce market is expected to be worth more than $2 trillion by 2034, surpassing the U.S. and standing second to China.

The global online hyperlocal services market is projected grow at a CAGR of 32.6 percent by 2025. The Inc42 Hyperlocal Market report 2016 mentioned that over $1 billion which constitutes around 26 percent of the total investments raised by start-ups from 2011–2016, were invested in the Indian food hyperlocal space. Some of the major players in the food segment are Swiggy, Just Eat, Runnr, and Burrp, among others.

Online and teleshopping companies are generating most of their orders from smaller towns, which is creating opportunities for hyperlocal delivery.

Keeping in mind the increase in hyperlocal logistics demand seen in the past four years, ASK Chaitanya Reddy, Co-Founder & Chief Operating Officer, VDeliver, said that hyperlocal delivery in the Indian market is set to grow tenfold in next 5 years. Hyderabad based VDeliver is an intra-city delivery startup that offers hyperlocal logistics services for healthcare, medical, surgical equipment, gifts, office supplies, packaged food, juices, and business documents.

Reddy informed, “We are introducing various services with technology and micro warehousing concept which will position us as a micro logistics service company than just an intra-city service company.”