Why You Need a Logistics Aggregator for Your E-commerce Business?

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Logsitics Aggregtor in India

Growth of the E-commerce Logistics

According to Novonous, a Bangalore-based market research organization, India has a logistics industry and logistics aggregators of worth $300 billion. The country spends almost 15 percent of its GDP on expenses related to transportation and logistics. This is a far greater amount than the 8 percent that most other developing nations spend on this industry. 

Further, the logistics market in India is expected to expand at a rate of over 12 percent by 2020. This growth will be driven by the retail, manufacturing, e-commerce, and FMCG sectors, which have themselves been growing quite fast in recent years. The Indian logistics and logistics aggregator industry is expected to be worth $301.89 billion in 2020. 

Why is This Sector Growing So Fast?

The implementation of the Goods and Services Tax (GST) has provided a major boost to the logistics companies in India. It has allowed the industry to reduce costs and improve profit margins by optimizing their operations and setting up large warehouses in every region of the country. This is possible because courier companies in India no longer need to pay different rates of indirect tax in different states, which makes inter-state delivery logistics much less cumbersome and costly.

The growth in the e-commerce sector and the expansionary policies were undertaken by FMCG giants. It has also helped logistics aggregator startups in India to expand by leaps and bounds. Thanks to the growing demand for e-commerce courier services. However, to keep growing, logistics firms also have to meet the strict demands for quick and efficient delivery with stringent service level agreements.

Moreover, innovations are essential for companies in this sector, as is keeping pace with the ever-evolving technology. The demand for greater reach, faster shipping, and lower costs never ceases, and a courier company in Mumbai or any other part of India must keep innovating in order to meet and exceed the expectations of its clients and customers. 

The Role of a Logistics Aggregator Platform

Considering how fast this sector is growing, it is important to get a good understanding of exactly what a logistics aggregator company does and what its roles are in the e-commerce space. Typically, a logistics aggregator provides e-commerce shipping solutions in India and around the world. 

A group of agents from this company might be responsible for processing all the operational components such as storage and transportation. They might be required to sort the products into categories, store and warehouse them as needed, and then to package and ship the goods safely when an order is placed. 

They are responsible for all the steps required to get the product safely into the hands of the end-user or customer. After the job is complete, the logistics aggregator gets a commission for the services provided.

Many such startups serve as logistics partners for e-commerce in India. This is because the e-commerce sector relies heavily on logistics aggregators and would collapse without the aid of courier services which are used to speedily and cost-effectively ship the products to buyers. 

Logistics companies also operate several warehouses and fulfillment centers around the country, where these products are stored until the final delivery. From there, they are responsible for safe storage, proper packaging, as well as transportation for delivery. They provide all the logistics required to keep customers happy with timely and safe deliveries, in return for a processing fee or percentage commission. 

The demand for these services is on the rise, and logistics startups in India are riding the wave to grow exponentially with every passing year. 

Why Hire Logistics Aggregator?

If you own or manage an e-commerce or FMCG company in India, then hiring a delivery logistics provider is almost a must. This is true for a number of reasons, including the growing expectations of customers. The goods and services will be delivered to their doorstep within days of the order being placed. So, if you want to retain your customers and expand or grow your business, then you must learn about the top logistics aggregator platforms in India, before selecting the one that best suits your needs.

No business or company can go it alone forever. To increase profitability and maximize customer satisfaction, you need to have the right partners. Third-party logistics providers can help you free up your company’s resources in terms of time and manpower, which you can then use to manufacture better products or provide better service to customers. As a result, many of the most successful e-commerce companies are opting for logistics outsourcing in order to optimize their supply chain and improve organizational efficiency.

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Benefits of hiring a logistics aggregator

Mentioned below are 10 important benefits of hiring a logistics partner for e-commerce in India.

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Reduced logistics costs

The 2016 State of Logistics Outsourcing Report stated that over ninety percent of third-party logistics users agreed to outsource the logistics side of their business to a reputed logistics aggregator. Over seventy percent of the respondents agreed that the use of a logistics aggregator platform had helped them reduce overall logistics costs. 

No investment in distribution infrastructure

The third-party logistics provider you will be hiring has already invested money to build warehouses and set up transportation systems for the shipping, storage, packaging, and delivery of goods. Hence, you don’t need to spend on creating or setting up this type of elaborate distribution infrastructure. The costs are shared across all the clients that the logistics company serves and don’t have to be borne by any one company or business. 

Lower systems investment

The top logistics aggregator platforms have advanced systems for the management of warehouses and transportation vehicles. This will allow your company to avoid spending capital on software programs and other digital products needed for maintaining elaborate logistics management systems. While you will need to pay a little for these overheads, the cost will be shared between many clients and will therefore never become a major financial burden for your business.

No fleet maintenance required

The right shipping aggregator company will provide you with an option for dedicated contract carriage. This will allow you to avail the benefits of a private fleet without having to purchase trucks, hire drivers, maintain equipment, and manage compliance and liability issues which could lead to fines, lawsuits, etc. All of this will help you save a lot of money without compromising on the timely and safe deliveries that your customers have come to expect. 

Economies of scale can be leveraged

Third-party logistics providers also enjoy substantial economies of scale. This is because they are responsible for storing and transporting the products of numerous companies. Hence, they have lower operating costs per unit of delivery since they can bargain effectively with courier companies due to the large volumes being transported. They leverage their aggregate freight spend to ensure that per unit expenditure is lower for their clients.

Sharing of freight costs and liability

Truck aggregators in India and around the world can arrange for full truckloads of goods to be transported at once. So even if your company simply needs to deliver a handful of packages to a particular destination, the aggregator will have other clients who need to make deliveries in the same area. Hence, all of these products will be delivered in a single shipment, helping you save money by sharing the costs of transportation and delivery. Plus, if anything goes wrong during transportation, such as an accident or mishap, the liability will be borne by the shipping aggregators you have hired.

Manage fixed and variable costs

The number of goods ordered and the number of deliveries you need to make might change from month to month and year to year. It’s impossible to constantly adjust the amount of labor hired and the number of warehouses rented in accordance with the changing demand and supply conditions and distribution volumes. A third-party logistics provider will save you the trouble of constantly adjusting the space and labor you need for distribution. Hence, you won’t need to pay for more resources than you need at any given time and your distribution costs will always be parallel with your revenue stream. 

Better access to new markets

When entering a new market (such as a new town or state) you will have to build up your own distribution capability from scratch. This includes buying fleets of trucks, renting warehouses, hiring and training delivery personnel, etc. All of this can take a lot of time. In contrast, a reputed provider of e-commerce shipping solutions in India can help you quickly enter a new market and sell your products to customers in an area where you have no logistical capability or infrastructure. They will store your inventory, make deliveries on your behalf, and interface effectively with your systems.

Scale labor resources cost-effectively

A third-party logistics provider can help your company by hiring temporary workers as needed and managing a virtual workforce that will allow you to achieve goals in a cost-effective manner. This way, if you have a sudden spike in orders, such as during a festival, you can handle the extra load in an economical manner. A good logistics aggregator platform will allow you to avoid adding a permanent monetary burden by hiring full-time workers who might be redundant during the rest of the year.

Better performance

According to the 2016 State of Logistics Outsourcing Report, 83 percent of companies that have hired the services of third-party logistics providers report improved service outcomes and customer satisfaction levels. The internal resources of your firm might be limited, but a company providing e-commerce logistics across India will be able to marshal resources from around the country to meet stringent deadlines and make timely deliveries, satisfying even the most demanding customers.

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Therefore, we can say that hiring a top logistics aggregator company in India will help you continuously improve your service while minimizing expenses. Most successful logistics companies have dedicated teams of operators and engineers who analyze and optimize logistical processes and systems on a constant basis. Partnering with such a company will free up your time and money to focus on your core business, which will, in turn, allow you to improve your product or service and win more customers over time.

Which Are the Top Logistics Aggregator Platforms in India?

The logistics sector in the country is booming and there are many logistics startups in India looking to change or monopolize a specific segment of the delivery and shipping business. Some logistics companies deal only with shipping, or solely with air-freight, trucking, or e-commerce logistics. 

On the other hand, some of the best companies in this sector offer clients an integrated logistics platform as a one-stop solution to all their logistical problems and requirements. India is geographically humongous and has great population density, with over 15,000 pin codes spanning the country. Thus, logistics providers who can cover a large geographical area at affordable rates are greatly sought after. Some other characteristics of a good third-party logistics provider are:

  • Speedy deliveries
  • Multiple payment options
  • Timely pick-up of returned items
  • Comprehensive return facilities
  • Safe and secure packaging
  • Comprehensive insurance for shipments
  • Trained personnel
  • Quality logistics software and database
  • Maximum pin code coverage
  • Efficient support department

Mentioned below are some logistics aggregators that can provide you with all these facilities and more.

Shyplite

This is a tech-centric logistics aggregator that caters to the logistical needs of online sellers through a B2B SaaS platform. It enables the e-commerce company to automate much of the logistical tasks for better productivity, greater efficiency, and lower costs.

Ship Yaari

This company provides logistics and back-end solutions to e-commerce organizations. It specializes in international supply chain management as well as planning and procurement activities. It also has multiple courier partners and handles over 2000 shipments per day.

Vamaship

This is a company that offers shipping, ocean, and air freight to e-commerce companies serving a geographically large market. It makes deliveries in almost 200 countries, apart from India. It offers competitive pricing and is known for its in-depth efficiency analytics. 

ShipDroid

They offer a single-point interaction system with e-commerce clients and maintain a great deal of uniformity when dealing with multiple courier partners throughout the entire logistics process. They make deliveries in over 600 Indian cities and have an efficient accounts and billing management system.

Ezytruk

This is a data-driven logistics aggregator that operates on an IoT platform. It connects carriers and shippers for the efficient transportation of goods in real-time. It offers great transparency in shipments and clients can get real-time data on demand. Their cloud infrastructure is also highly secure.

iThink Logistics

It is also an e-commerce logistics aggregator in India. We offer fully automated shipping and supply chain management solutions with complete transparency. We have a system of easy integration for online sellers with automatic synchronization and order-tracking facilities. With multiple channel partners, they offer fast and reliable service encompassing over 26,000 pin codes around the world. We are one of India’s fastest-growing e-commerce logistics solution provider. 

So, now that you know a bit about the best logistics aggregators and e-commerce courier services in India, you must be wondering exactly what services will be included if you decide to partner with a third party logistics provider. To help you get rid of any confusion in regards to this subject, we have listed some of the essential services that a third-party logistics provider can offer your business.

What Are the Major Services that a Logistics Aggregator Platform Can Offer? 

Transportation

From trains and trucks for land travel to ships and airplanes, a shipping aggregator company will help you deliver goods to your customers in a timely, safe, and cost-effective manner. They sometimes work with courier partners or may even have their own fleet of trucks and delivery vans in different parts of the country. They have also decided on an optimized route for transportation, which helps increase efficiency and reduce confusion.

Warehousing

The best e-commerce logistics aggregator in India will also offer warehousing solutions and most of them own their own warehouses in various parts of the country. These warehouses cover different distribution areas and act as a safe and secure storehouse for a variety of products. Once the order is placed, the product is retrieved from the warehouse and shipped to the customer’s address. The third-party logistics company will also provide inventory management software for keeping track of the goods stored in their warehouses. 

Freight Forwarding

Sometimes, you may need to make a delivery in an area where the logistics aggregator does not have any infrastructure. In that case, they engage in freight forwarding, which is to say, they contact another courier company in the area and hire them to make the delivery on your behalf. Hence, the logistics aggregator will essentially serve as a medium for you to hire the people or services you need in a timely manner so as to maximize customer satisfaction.

major services that a logistics aggregator can offer

Concluding Note

The process of supply chain management is neither easy nor straightforward. For small online businesses and companies, setting up a dedicated logistics department might be too expensive to be feasible. This is when hiring the services of a logistics aggregator or a reputed courier company in Mumbai and other parts of the country might prove useful. It will allow you to grow your business and focus on optimizing your key deliverables without spending much time worrying about logistical issues and problems.

Looking for an e-commerce shipping solution? Get started with iThink Logistics