Digital transformation driving continuous growth trajectory in India’s Parcel Industry: Venkat Rao, Pitney Bowes
CXOToday has engaged in an exclusive interview with Mr. Venkat Rao, Vice President & Country Head, Sending Technology Solutions, ANZ, India & ASEAN at Pitney Bowes.
What digital solutions are being adopted by the parcel industry? Is the current adoption rate enough?
Parcel industry in India has been experiencing continuous growth trajectory with factors like increase of online retail, ongoing digital transformation and an additional movement from the pandemic, which has urged more and more consumers to purchase online.
Consequently, the growth in parcel volume has led to its share of technology disruption, competitive marketplace and last mile delivery challenges for the ecommerce companies, carriers as well as shippers.
To help prepare for the evolving landscape, retailers are investing in digital solutions and processes that will help streamline and improve shipping for their end-customers, provide competitive edge:
- Automation: automation is an essential tool for retailers looking to transform, simplify, and accelerate their shipping process. By leveraging the latest all-in-one shipping platforms, built on innovative software-as-a-service (SaaS) engines and connected through the Internet of Things (IoT), retailers can harness the power of automation to prepare parcels for shipping directly from their computer. Automation also lets retailers further strengthen their capabilities by integrating eCommerce stores like eBay, Shopify, and WooCommerce for a seamless shopping experience for consumers.
- Prioritise tracking: today’s consumers have a real need for speed when it comes to shopping, and they expect to receive information about their purchases as soon as possible. Investing in solutions that let retailers manage tracking information, rather than outsourcing and leaving it in the hands of a distribution partner, can be an ideal opportunity for retailers to further engage with their customers through continued communications.
- Seamless returns: an easy shipping process needs to go both ways to truly provide the best possible customer experience, meaning a returns policy, and the process involved, must be clear for customers. To set themselves apart from competitors, retailers must consider returns in their shipping process. Retailers can prioritise speed in the returns process by including information within packages on returns, which can streamline the returns process and help them return consumers’ money quickly so they can shop again.
2. What are the new trends and technologies in shipping and ecommerce industry?
In 2021, parcel volume in India grew by 7%, a remarkable growth in post-pandemic situation. India has experienced 32% year-over-year increase in parcel volume from 2020, reaching $5.2 billion. – Source Pitney Bowes Parcel Shipping Index -2021
The trends shows that carriers are expanding their last-mile delivery capabilities by investing heavily in innovative solutions such as hyperlocal delivery, parcel lockers, parcel kiosks and 2021 also saw consolidation of multi-carrier shipping platforms through mergers & acquisitions.
There are three major trends that will impact retailers when it comes to shipping and logistics in 2023, and beyond, that businesses must be aware of:
Carriers expanding last-minute delivery to ensure faster deliveries
India generated the highest carrier revenue growth, a 32% year-over-year increase, bouncing back following a 2020 decline. Carriers are expanding their last-mile delivery network by investing heavily in innovative solutions such as parcel lockers, hyperlocal delivery, drone delivery, same day or next hour parcel kiosks, complete parcel management solution and full-stack supply chain, warehousing, and logistics.
Multi carrier shipping (SaaS based) platforms expanded in international logistics, shipping orders across countries via multiple carriers extending the platform capabilities – parcel pick up, tracking, delivery through the application. In 2021, India shipping and logistics industry witnessed consolidation of various companies through merger & acquisitions.
Ecommerce marketplace is focusing on being competitive
Competitive ecommerce marketplace is boosting the adoption of same day delivery among carriers and building upgraded delivery infrastructure, using technology for delivery optimization and warehouse automation that includes outbound shipping – conveyor operations, volumetric parcel weighing, put to light, and other innovation to provide same day or express or customized delivery options to boost end customer experience.
The carriers are also enabling Direct-to-Consumer (D2C) brands to deliver their webstore orders with expedited or same day delivery. Increased rural expansion and regional growth: regional centres are also recording growth in online retailing as a result of continued network development and business expansion, ongoing rural expansion, and the increased uptake of mobile services as regions continue to develop internet networks. As a result, more consumers across a wider geographic area now have access to online shopping, meaning retailers need to consider how to cater to these expanding populations.
Do you think that the exponential increase in parcel volume has created more growth opportunities for the SMEs and online sellers? If yes, why?
Retail is especially being impacted by the increase in online shopping resulting in an upward trend in eCommerce; and this has created more opportunities for online sellers to expand their customer base locally and worldwide.
In post pandemic scenario, the industry has witnessed unprecedented increased rural expansion and regional growth. The regional centres are recording growth in online retailing as a result of continued network infrastructure development and business expansion, ongoing rural expansion, and the increased uptake of mobile services. There were more than 749 million internet users across India in 2020, compared to just over 300 million in 2017, and this growth is projected to reach more than 1.5 billion users by 2040. As a result, more consumers across a wider geographic area now have access to online shopping, which means growth opportunities for small to medium retailers and online sellers to consider how to cater to these expanding populations.
The cross-border eCommerce logistics market is expected to grow by US$44.61 billion between 2021 and 2025, presenting a number of exciting import and export opportunities. While this means retailers will be able to leverage the prospect of delivering goods around the world, it also means global brands with no existing local presence will have more opportunities to capture the attention of local consumers.
What does the 2023 scenario look like for the Parcel Indian industry?
India Shipping Industry is categorized into First, Middle, Last Mile Delivery & Warehouse Automation. Last Mile delivery & Warehouse automation are the two biggest segments in terms of market opportunity (RoW) for Pitney Bowes. First, Middle, Last Mile Delivery category is estimated at $311B but with a growth rate of 7.4%. Whereas Warehouse Automation offers a $117B opportunity with a 15% growth rate. Ecommerce Fulfilment ($26B) is another category growing at 15%. It is followed by Delivery Management ($26B; 13% growth) and Reverse Logistics ($24B; 5.6%).
In the First, Middle, Last Mile Delivery category, the solutions are being built to solve challenges in the areas like Auto Dispatching, Electronic Proof of Delivery, Real Time ETA Calculations, Intelligent Dispatch and Routing. Similarly, in the Warehouse Automation category, solutions are built on Voice Picking & Voice Tasking, Automatic Identification & Data Capture, Sortation System, Intelligent Packaging Solution, Order Management Solution, Pick To Light, Conveyor Sortation and Warehouse Management System. In the Ecommerce Fulfilment category, the solution category includes Order Management & Warehouse Management System. In the Delivery category, the solutions being worked upon are parcel tracking, which includes Location Intelligence; & Mailroom Management.
How is Pitney Bowes innovating in this space to simplify customer’s business processes across different geographies?
As per the global industry trends, there is a consistent decline in letter volumes and same has been offset by an increase in parcel volume. There is huge boom on account of growth of e-commerce in India, with e-tailers requiring integrated collection, aggregation, sorting, transmission and delivery systems.
Pitney Bowes is building solution in the areas of advance integration of technology and doorstep delivery. We are transforming the highly successful mail franking model to parcels as well. We have demonstrated the capability with our solutions to support parcel booking and collection for all customer segment – online sellers, small & medium businesses, large enterprises and global postal organizations.
We recently launched PitneyShip Cube that simplifies shipping packages and ecommerce orders while saving time and space. PitneyShip Cube, an all-in-one Wi-Fi enabled thermal shipping label printer with integrated scale. With access to the companion PitneyShip software, PitneyShip Cube lets users process orders from retailers like Amazon, eBay and Shopify, weigh packages, compare discounted shipping rates, print shipping labels and track packages all from one compact device with either their mobile phone or computer.
Pitney Bowes is chartered to provide technology, logistics, and financial services to our customers in segments – small business, retail, enterprise, and government clients around the world to remove the complexity of sending mail and parcels.
