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India Post (Karnataka) generates Rs 50 Cr revenue on the back of e-commerce deliveries

india post

India Post (Karnataka Circle) has generated Rs 50 crore revenue in the current financial year, on the back of e-commerce deliveries for Amazon, Snapdeal, Flipkart, Myntra, Homeshop18, and Global Shiksha among others, reports The Times of India.

India Post (Karnataka Circle) chief postmaster general MS Ramanujan told the publication that they currently take up both Speed Post & Cash on Delivery (CoD) orders. This week India Post will also be piloting a same-day delivery service for Amazon, which would see all products received by India Post by 3 pm are delivered on the same day.

Delivery service for e-tailers: Earlier this year, India Post had signed a MoU with Snapdeal & Shopclues.com to work as a delivery agent, after piloting the service with Snapdeal & Amazon last year. India Post had first launched delivery services for e-tailers in April last year. At the time it was reportedly building 20 mechanised warehouses and booking centres to handle the shipments from e-commerce companies. India Post’s cash on delivery service was launched in December last year through a pilot project with Amazon India.

India Post’s delivery service probably has the widest reach in India, with over 1.5 lakh post offices across 25,000 pin codes. Improving efficiency & reliability and reducing time of delivery was India Post’s primary challenge, which has allowed for a large and competitive courier service market in the country. That being said, when it comes to tier III & tier IV towns no courier company can match India Post’s reach.

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Task force to leverage post office network: Earlier this year, the Indian government had set up a task force to explore ways of using the post office network in the country to provide last mile services. The task force report (pdf) has suggested that three separate subsidiaries be formed as part of a holding company under the Postal Department, that would focus on services in e-commerce, banking and insurance segments. Each of these subsidiaries would be operated as Strategic Business Units (SBUs).

Competition

– In August this year, mail and logistics group Deutsche Post DHL (DPDHL) had piloted its e-commerce logistics business in India through its Indian subsidiary Blue Dart Express. At the time, the company had said it would invest €100 million in the country over the next two years to build the infrastructure for this business.

– In November 2013, courier and logistics company DTDC had launched a logistics solution for e-tailers called DotZot. The service claimed to deliver products to over 8000 pin codes across 2300 cities in the country.

– Distribution and Supply Chain Solution company Gati had also launched an e-commerce focused website GatiConnect. The company had reported in its annual report that its e-commerce division generated revenues of Rs 40.7 crore and recorded a CAGR of 130%. As of March 2014, e-commerce contributed 19% of Gati’s overall business.

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