Isn’t there an Uber of just about everything? Entrepreneurs seem to use it generously to give a sexy spin to just about any business from household services to education. On-demand just doesn’t have the same spin, does it? But what if there is a business that actually is a logical extension of the Uber model? If commuters can be in a state of perpetual motion with a few taps on the screen, why not goods?
Say hello to the pimply cousin of on-demand cars, the Uber for trucks.
Lumbering trucks transport goods across the country and usually are the lifeline of any economy. The lakhs of mini-trucks chugging away within a city function as the last mile agent. And as with any unorganised business, small truck owners form a local cartel. They dictate price and squeeze small and medium enterprises (SME) like those that sell electronics, furniture, paints and timber. But even with this tilt in the balance of power, it is not like these truck drivers get any richer. There is no predictable way of anticipating demand. So after idling away in the local adda for more than half the working day, truck drivers overcharge the customers anticipating an empty return trip.
A lose-lose proposition all the way.
So naturally, it became a space that had to be disrupted and begged the attention of startups to try and ‘Uberise’ it, and try they did. The app gives a business owner an ETA on when a truck will be at his doorstep and at a price that is decided by an algorithm. The driver gets a promise that there will be more rides.
Given the scale of the problem (last mile logistics in India is estimated to be worth $15 billion, according to industry estimates) in 2014 and 2015 as many as 74 on-demand last mile trucking startups got $10.6 million in funding, according to Tracxn. Companies such as Porter, the Karrier, TruckSumo, Turant Delivery, Cargoji, LetsTransport, Shippr all set out to solve the problem for both drivers and SMEs using technology, and there it was the Uber for trucks.
When it all started, most of these companies chased SMEs because that is where the inefficiency was at its peak.
Large companies had contracts with slightly more organised logistic providers and fixed requirement. Here, too, there were inefficiencies as trucks idled half the time, but for companies, predictability scored over better utilisation and cheaper rates.
“For us, SMEs were the real business problem to solve.