Blue Bird Logistics, which has been in the air and ocean cargo business for nearly two decades, has started the first ever online platform for cargo delivery— e2ecargo — which aims at solving the problems of the traditional cargo delivery business.
For small and medium businesses shipping cargo has been a constant hassle for decades — varied shipping rates, custom clearances and logistics have been a plaguing problem. “It is like Makemytrip — there is a uniform rack rate for the sender. Once they fill the forms online, and book their shipment their work is done,” said Sanjay Aiyer, director at Blue Bird Logistics, of which e2ecargo is a subsidiary. In its existing process, for commercial cargo delivery a business unit has to make calls and negotiate rates, which vary from vendor to vendor. Experts said that once online, such problems are solved as it brings a lot of transparency into the system. With an investment of Rs50 lakh so far, Aiyer said that the business has a lot of potential.
The cargo business out of India is estimated to be more than $1.5 billion, which measures 8 lakh metric tonne of cargo every year. “Even if we get 10% of the business ($150 million), that’s huge,” said Aiyer.
However, Aiyer is not making any money from the business. “We are not keeping any margins as we are going for market share, but once we have some scale, we will make three to four per cent net margins,” he said.
The scale that Aiyer is talking about will require a lot more investment — about $3 million only in technology, and then there is people cost, purchase of capacity from airlines for cargo, and cost of establishment. “There is a minimum requirement of at least $6 million (Rs10 crore) of investment,” he said. In its next phase, e2ecargo will enter the ocean cargo space.
E2ecargo picks the parcel from the doorstep, takes care of custom clearances, takes care of all airline and terminal charges and helps in providing lower landing charges to its customer. Two months old, and in its beta stage, the platform has already handled 196 such deliveries.
However, the delivery is only for parcels that are less than 480 kgs. “The system is for the SMEs. We consolidate several small consignments and make it into a larger consignment, which allows us to reduce the rate,” said Aiyer. The more the weight, the lower is the price per kg for shipment. Overall, a sender can save anything between 30-40% on each delivery, compared to brick and mortar cargo.
Aiyer has also signed contracts with eight airline companies — European and Middle East carriers — to remove middle-men and get cost benefits. Only present in Delhi, Aiyer plans to extend services to Mumbai, Kolkata, Bangalore, Chennai and Hyderabad. “Almost 90% of the cargo goes from these towns,” said Aiyer.