"The buzzword is fourth-party logistics"

Font Size

Print

Feedback

Email

Discuss

: Gati was founded in 1989 with the objective of providing trucking and courier express delivery services. A decade on, the company claims to be doing well as a result of organic growth and successful acquisitions and partnerships. Headquartered in Hyderabad, with over 3,000 employees across the country and listings on the Bombay Stock Exchange and the National Stock Exchange, Gati claims to be the forerunner in the delivery business in India. In this interview, Anil Atri, who, for past year-and-a-half has been chief sales and marketing officer at Gati, speaks with FE’s Malvika Chandan about the benefits of choosing a third-party logistics company such as Gati for courier and trucking requirements.

What is the size of the logistics industry? How well organised is it in India and who are the key players?

The express delivery industry, which includes courier, cargo, perishable goods and airfreight, can be divided into the organised and unorganised sectors. The organised sector stands at Rs 7,000 crore, of which Rs 4,000 crore is contributed by domestic delivery, and Rs 3,000 crore by international delivery.

But purely courier would be about Rs 1,800 crore (domestic and international put together). The unorganised sector is hard to account for, as it is very fragmented. The Indian logistics industry is $90 billion today, and is expected to grow at a CAGR (compound annual growth rate) of 16% to $120 billion by 2011.

A fair amount of consolidation has taken place in the market. TNT acquired trucking company Speedage to grab a share of the express market. TNT is part of the Netherlands-based TPG (the company goes under the better known brand TNT). For surface carriers, DHL (part of Deutsche Post) is a big player, which acquired Blue Dart. Safex is another big player. Federal Express acquired Prakash Air Freight about two years ago. The other global players in the market are Expediters and Kuehne + Nagle as well as United Parcel Service.

What are some of the challenges faced by the industry today?