The exact term is more. And everyone wants more of it. Consumers and companies.

E-commerce companies want you to buy more and they want you to buy often. With UberEats in India, Ola’s revival of its food delivery business through Foodpanda, Swiggy’s experiments with new money, and Zomato’s plans to bag more funding, the food tech business is more and more looking like the heydays of 2015. Then there’s the mother of all problems to solve—hyperlocal. Every company worth its salt is after ‘customer delight’, a term commonly used by the e-commerce industry to denote speedy delivery.

Delivery is the holy grail. To get a product to a consumer as soon as possible. Get it as right as possible. Get it by estimating what the consumer will need before the consumer places the order. This makes logistics stand out as the defining factor. The speed of delivery is no longer seen as an expense but a leverage for online businesses to ensure loyalty. And hence these companies are willing to spend more on efficient processes and services.

Irrespective of which online business or sector trumps, logistics will be a clear winner in the rush. Last year saw the reinforcement of this belief with a $100 million infusion into e-commerce-focused logistics company Delhivery from Carlyle Asia Partners.This year, it will be Alibaba’s $100 million bet on Xpressbees to complete its ‘iron-triangle’ strategy of payments, e-commerce and logistics in India. These companies will grow beyond last mile delivery providers to add meaningful lines of business.

Iron Triangle

The 'iron triangle' strategy was called the fulcrum of Alibaba's growth by founder Jack Ma. This includes owning an e-commerce store, Taobao in Alibaba's case, which sells everything; cost-efficient logistics in the form of Cainiao and hassle-free payments through its e-wallet Alipay. The three components create a holistic shopping experience

The year 2017 saw sizeable capital investment in logistics infrastructure. This includes a joint venture between Embassy Group, private equity firm Warburg Pincus, Everstone Group’s Indospace and Canada Pension Plan Investment Board and others. The new year will be about the business carried out by smaller players who lease and manage the infrastructure.

“We have seen almost $3 to 3.5 billion going into building infrastructure. With Goods and Services Tax (GST) coming in, companies want to move to modern warehousing facilities and consolidate their warehouses,” says Rahul S Dogar, co-founder at supply chain management company Holisol Supply Chain Solutions.

This year will also benefit private equity-backed transport companies such as Rivigo and BlackBuck which provide value-added services to truck-owners. The line of business will also become attractive for companies like Delhivery and Ecom Express.

AUTHOR

Payal Ganguly

Payal started writing news features six years ago and has written on startups, civic issues and education. Currently based out of Bengaluru, she has worked with The New Indian Express in Hyderabad and more recently, at The Economic Times, writing on e-commerce and logistics. A post-graduate in Molecular Biology and Biochemistry, she will be writing on e-commerce, science and technology at The Ken. She firmly believes that Bollywood classics have the power to heal and inspire.

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