secretstalks
Sahil Barua, CEO of new-age logistics firm Delhivery, believes that the economics of 10-15 minute deliveries may not be sustainable beyond groceries and fast-moving consumer goods. In an interview with ET’s Pranav Mukul and Samidha Sharma, Barua predicts that delivery timelines will likely increase as the costs of quick deliveries become more evident. Delhivery, which returned to profitability in the April-June quarter, is launching a network of shared dark stores for brands and e-commerce players to enable 2-4 hour deliveries. However, Barua, who also serves as an independent director at IPO-bound Swiggy, emphasizes that Delhivery will avoid instant deliveries.
Delhivery has experienced slow revenue growth over the past year. Are you feeling any pressure on your top line?
Our e-commerce-linked express parcel business is indicative of current market conditions. We could have grown our volume a little bit further, but Meesho’s launch of Valmo, its logistics vertical, last year somewhat limited the overall quantities available to third-party players. Since we don’t rely on Meesho as much, we’re less impacted overall, but the total quantities accessible on the third-party side have decreased. Additionally, we are in the midst of commercial renegotiations with many of our clients at this time. Therefore, the volume uplift takes some time until it is completed.
What’s the focus going forward?
“Our primary focus over the last two to three years has been the PTL (part-truck load) business. As these segments grow, they become more efficient, including express shipments, which has led to improved profitability. Additionally, we’ve been capturing market share not only from organized competitors but also from the traditional market, as these are large yet unorganized sectors. However, the truckload business has faced challenges, primarily due to the impact of elections and rains.”
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