Logistics and transportation for small and medium enterprises (SME) in India is broken. Much to the extent that logistics eat away 30 per cent of traders’ time even as transportation occupies lion’s share of up to 70 per cent of the logistics cost.
“The two are the necessary evils for traders,” says Kausalya Nandakumar, Chief Executive Officer of SmartShift – another boat from the Mahindra and Mahindra mothership. Nandakumar explained how it let traders to lift up their businesses rather than goods.
SmartShift does the matchmaking between transporters and traders, right?
Yes. We are a cargo transport company providing on-demand small commercial vehicles or mini trucks largely focusing on SMEs. The logistics and transportation problem shifts focus of traders away from the core business. So we aim to connect traders with transporters, whenever they need it on real time basis through our app and web-based platform as well as through our contact centres.
This allows them to focus solely on their business and lift it up - as envisioned in our tag line ‘Business Ko Lift karo’.
How do you curate the two parties on the platform?
Traders can locate their nearby transporters and can bid the price to them to get the best cost advantage or can request us to send the cheapest transporter at a particular price. Once the truck is assigned to the trader, he/she can track the movement of goods right till its delivery location. Post completion of the trip, both trader and transporter can rate each other for their experience. That’s how traders and transporters are self-curated on the platform while the necessary background checks are undertaken by us.
How the economization happens for transporters?
Transporters perpetually fret about inconsistency in getting orders. Also most of the time their trucks come back empty in their reverse trip as they don’t have any network or business development activity outside their local area nor they have the capabilities to develop that network. So the asset utilization is poor because traders’ access to information is poor. Also pricing is very subjective to every transporter as reverse trip is always empty. The solution to this is an aggregator platform, which knows about the demand and supply of trucks and hence can match the two wherever required. So there is continuous access to business for transporters.
What’s in the pitch you add to traders and transporters?
We are already among the largest players in local transportation for SMEs in India. In terms of value proposition, the concept of bidding is very significant because it gives a sense of bargain that Indians love to do. Through this we are able to economize the trips quite well for traders compared to what they get conventionally. Also since we are a Mahindra company and we do lot of curation of our supply, that is transporters, it helps us to build better value proposition versus another startups in similar space.
Do you take care of partial truckload?
For mini trucks, usually complete truck is to be booked. However we accommodate if traders want partial truckload. We call this as the beat system. We advertise the available space in truck en route that traders can book. However we are still testing this initiative. If the truck breaks down, usually the transporter needs to arrange for another truck or he/she can call us to do so.