Building the backbone of SME E-Commerce Logistics in India: Why We Invested in Pickrr

Image credit: Pickrr

The Indian economy is currently going through a period of great challenges. The pandemic has upended many of the best-laid plans across sectors. However, very few sectors seem to have benefitted in the face of the current turmoil as e-commerce has. India's rapidly growing e-commerce sector is expected to reach USD 99 billion by 2024, growing at 25%+ CAGR with the number of online shoppers in India expected to reach 220 million by 2025. This accelerated growth has been a shot in the arm for Small and Medium Enterprises (SMEs) who are using online platforms and marketplaces to reach consumers across geographies and categories, especially during the pandemic when physical interactions have become limited.

In a recent study by FedEx, 30% of small and 40% of medium Indian businesses stated that they have witnessed significant improvement in their e-commerce sales since the pandemic began. Yet, all SMEs see themselves at a disadvantage because of one major pain point - logistics.

Shipping (or freight) is a huge pain point for many types of e-commerce businesses, from new-age DTC brands to individual marketplace sellers to FMCG companies for whom e-commerce is a new channel. They don't process enough volume for them to get the best rates from shipping carriers. Prices are not transparent and negotiating as a small business is next to impossible. It's costly and resource-intensive for large carriers to work with SMEs, who are often deprioritized as a result.

With costs typically in the 7%-10% of GMV range, shipping is often overlooked as an area that is critical to a small e-commerce seller's bottom line. While most e-commerce businesses easily use existing payment solutions (payment gateways, UPI integrations, etc.) to handle payment processing, shipping "˜stacks' are yet to be developed.

Targeting this need, Pickrr works as a virtual shipping partner that provides a one-stop platform for shipping requirements to individual e-commerce sellers, small brands, and SMEs.

They simplify shipping by giving e-commerce sellers an easy-to-use streamlined platform to work with all major pan-India shipping providers at once. This allows Pickrr to leverage economies of scale to pass on discounted rates to sellers. As Pickrr negotiates pricing by aggregating its users, the more e-commerce sellers that join Pickrr, the better the pricing for everyone, i.e. true network effects.

We run a small business of ladies' footwear based out of Okhla. Initially, we faced a lot of problems with the delivery of our products to the customers. It took months for the final product to reach the customer's doorstep and the delivery partners never took any responsibility for delayed deliveries. We have customers across the country and we faced serviceability issues in a lot of pin codes. After we started working with Pickrr, our problems were solved instantly, and we were able to provide improved customer service. Pickrr has helped us with wide serviceability and now we can reach our customers anywhere in India within 2-3 days. Pickrr also helps us with compensation for any transit damages as well. I have been recommending Pickrr to everyone running an online business.

Satya Prakash, Truffle Collection

Businesses use Pickrr to access the best rates at the highest service levels, choose the right shipping offering for their orders and generate shipping labels within minutes. Pickrr's AI-enabled free-to-use SaaS platform automatically matches orders to the best delivery partners based on parameters like real-time courier service levels, origin-destination, etc. Strong tech interventions help reduce non-delivery rates and manage COD cycles for sellers. All this results in cost savings of more than 20% along with superior service levels. Pickrr also offers direct API integration with default order generation platforms like Shopify, Woocommerce, Magento, etc., thereby simplifying onboarding and providing a seamless order management/ tracking experience. The strength of the platform lies in its innovative features designed to optimize, track and solve for every step of the shipping process.

As a next step in the evolution for solving for needs of SMEs, Pickrr is building a full-fledged fulfillment network, aggregating fulfilment, and delivery capabilities elegantly, to provide small businesses with an end-to-end logistics infrastructure.

Armed with the right combination of technological capabilities, operational prowess, and a diversified customer base, we believe Pickrr has the potential to create a significant impact. It's on the path to help thousands of small businesses and individual sellers, many of whom are first-time online sellers, manage logistics efficiently thereby enabling these sellers to compete with large e-commerce marketplaces and stay relevant.

Working with Pickrr helped to keep our business running smoothly during the pandemic. Pickrr is a very cost-effective solution for us and caters to all the pin codes in India where our customers order from. Their customer support team is brilliant and responds in almost real-time. Pickup and delivery of even small packages are seamless, with an easy resolution of queries like weight differences or calculation errors. Because of Pickrr, our business has improved overall, and our customers are highly satisfied.

Shobha, Pinnium Brands

We are thrilled to partner with Rhitiman, Ankit, Gaurav, and the entire Pickrr team as they pursue their vision of leveraging technology to enable SMEs to get access to the best logistics experience, while they focus on the growing top and bottom lines. In due course, we expect Pickrr to leverage its network of demand and supply-side partners to play a key role as an enabler to India's sparkling e-commerce story.

Our investment in Pickrr fits squarely within Omidyar Network India's investment strategy of enabling access to tech-led utilitarian solutions for SMEs. Our focus is also on empowering small business owners, most of whose employees belong to the Next Half Billion segment. Pickrr also delivers on this front by helping these businesses as well as creating employment in the logistics and supply chain sector. By improving processes and efficiencies in this space even further, Pickrr has significant potential for creating far-reaching, long-term impact in the overall landscape and generate significant efficiencies and scale for the Indian e-comm and SME sectors.