FROM MAGAZINE: Interview with TA Krishnan, CEO of Ecom Express
Logistics solution provider Ecom Express has grown into a formidable player since its inception in 2012.The firm provides end-to-end logistics solutions for e-commerce companies. In an interview to Shreya Bhattacharya, CEO TA Krishnan says his company has taken strategic steps to strengthen its financials and achieve all round growth of the business. The company’s focus has been to accelerate growth through widening of network capacities besides optimum utilisation of the resources across the network.
Ecom Express has been one of India’s fastest growing, e-commerce dedicated logistics solutions providers. What innovative technologies and approaches have you adopted or plan to adopt that sets Ecom Express apart from other logistics solution providers? Ecom Express strives towards a combination of delivery speed and innovation – as its strategy to add value, and most importantly, continue developing delivery logistics solutions as a powerful means of differentiation. Our network coverage has not only facilitated, but driven rapid e-commerce volume growth in remote locations. In e-commerce industry, speed of delivery is as important as the product quality for a customer. In order to facilitate faster and accurate service to customers, Ecom Express has deployed automation solutions at the first and last mile. The Company has also invested in such innovative and tech solutions and opportunities that augment and support productivity and efficiency in support of improved service deliverables. Tech based solutions at backend and in the field are at a large scale ramp up mode and we see this being a clear differentiator in offering seamless solutions across the supply chain system.
Unlike any other logistics partner for the e-commerce industry, Ecom Express prefers last mile delivery staff on the company's rolls as we understand the aspirations of our employees and encourage them to grow in their career with us. The strategy has yielded rich results with front line delivery associates growing within the organization to lead positions in a short span of three years since the company has come into existence.
Another unique initiative of Ecom Express is to launch the complete coverage of states within the country. Though considered revolutionary to build infrastructure to cover every last doorstep within the country, the company has identified models that can build this scale sustainably and has successfully executed the strategy in seven large states: Delhi, Goa, Haryana, Tamil Nadu, Andhra Pradesh, Telangana and our recent addition being the state of Karnataka.
Your company has 100 per cent coverage in seven states of India and plans to expand its network further. What do you think are the key challenges in organizing the inter city and intra-city logistics market? The logistics space in the e-commerce industry faces challenges due to cross-state transportation and fragmented tax system. The hurdles and complexities in the supply chain track acts as a hindrance to efficiency and turnaround times creating a multiplier effect on growth. However, with the impending implementation of the Goods & Services Tax, the industry will now stand to gain as it will bring ease and simplicity in the chain and will help the industry move a lot towards progress.
What are your future expansion plans? Ecom Express has been aggressive on its growth plans and plans to achieve its strategic goal of extending full state coverage to over 23 states and 80 percent pin codes of the country within the next two years. The company has a fundamental faith in the growth potential of Tier IV and rural areas of the country as it believes that the next generation of buyers will come from there. In the near future, Ecom Express aims for distribution in urban and rural areas through 3000+ delivery centers and over 25,000 delivery staff directly on its payroll reaching out to over 1.5 million customers and 200K sellers at a daily level. By 2019, the company aspires to setup a logistics network spanning the entire length and breadth of the country.
As a new line of business, the company is also looking at increasing the number and size of fulfilment centers and warehouses. The launch of Super-hub Operations this month, the largest Warehouse cum Pickup Processing Centre and Fulfilment Centre spread across 500,000 square feet in Haryana (National Capital Region), and more of such large scale establishments in due time, reinforces our commitment and being future ready to tap immense potential and growth of the industry.
Ecom Express has also experimented with cross-border e-commerce outbound shipments paving the way for fully implementing cross-border logistics services in the near future.
Ecom Express raised $133 million from Warburg Pincus in June last year. How have you utilized these funds in boosting your business? The capital infusion from Warburg Pincus into Ecom Express was the largest round of funding raised to date in the Indian logistics sector. The proceeds being to expand the Company’s delivery footprint in tier 3 and 4 towns and cities. We also plan to invest further in technology, deploy advanced parcel sortation systems, and strengthen network reliability and infrastructure, among others. These initiatives would help Ecom Express deliver superior customer experience and build a highly competent and scalable business.
Are you approaching other investors to invest in your firm? Also has any other deal been finalized or is close to finalization? We are looking to raise another funding early next year.
How do you think the GST is going to impact the Indian logistics market and to your firm? The GST implementation will enable favourable conditions to the e-commerce industry and complete ecosystem with India becoming a unified market. All the hurdles and complexities in the supply chain track will be dismantled thereby increasing the efficiency and turnaround times and creating a multiplier effect on growth.
The logistics space which acts as catalyst to the e-commerce industry will stand to gain as it will bring ease and simplicity in cross-state interactions, rectifying the current fragmented tax system challenge and be beneficial to the ecommerce logistics players including Ecom Express.
The logistic needs of the industry are evolving rapidly with the changing business requirements. The industry has been witnessing a rapid scale-up in service orientation and complexity with an ever-increasing emphasis on service levels, increased penetration in tier-II and tier-III cities, surged Cash on Delivery (COD) services, geographic penetration and supply chain security requirements. The massive growth of e-commerce sector is only going to increase the need for quality logistics, which will in turn spur the growth of the logistics sector.
