Porter, a leading tech-based, on-demand, intra-city logistics company has announced the divestment of its FMCG Modern Trade business segment to Cogos Technologies, a leading tech-logistics startup. The company says it has undertaken the strategic divestment to realign its business priorities and strengthening focus on on-spot demand services and technology amelioration. It was during the pandemic that Porter diversified its service offerings to cater to the requirements of FMCG companies, and it has now reassessed its business priorities and the divestment to COGOS Technologies stands in line with Porter’s focus on delivering customer experience through technology enablement.
Pankaj Shroff, CFO, Porter said “We have always been at the forefront of assessing and strategising our decisions to maximise business efficiency. During Covid we started multiple lines of business, including Modern Trade. After due deliberations, we decided to focus on our core business and found an able alliance with Cogos Technologies for the continuity of the Modern Trade business. We are positive that with Cogos’ capabilities and expertise in this segment, the business will scale to new heights.”
This move aims at ensuring continuity of the business vertical with Cogos’ enterprise led business model. Porter’s Modern Trade servicing team accounts for close to 5 per cent of the total workforce and all the employees have been absorbed based on the business needs of both the companies.
Prasad Sreeram, Co-Founder and CEO, Cogos said, “FMCG segment is a very crucial and essential business around the world. While modern trade plays a very vital role in brand visibility and revenue share for the FMCG companies, they have a critical challenge in delivering to modern trade. The penetration of tech-logistics in this space has been minimal leading to loss of opportunity and higher costs for FMCG companies and modern trade. With this investment we are looking forward to organising and optimising the supply chain of the sector with our state-of-the-art tech platform and advanced delivery system.”
At present, Porter operates in 15 cities across India and is looking to expand its base by creating newer use cases for its various business verticals including packers and movers and on-spot demand service. The company plans to enter top 35 cities by 2023 with a focus on tier 2 and 3 cities.
On the other hand, Cogos has been aggressively working towards organising the city-logistics market and with this investment, it aims to strengthen its platform in order to suit the demand of city logistics. They also aim at expanding their fleet to 50,000 vehicles in order to meet the demand. Post the transaction, Cogos would have the FMCG vertical operations in Delhi, Mumbai, Bangalore, Pune, Chennai, Kolkata, Ahmedabad, and Hyderabad, and will eventually expand this to over 300 cities where it already present. Certain staff, vendors, partners, and customers involved in this division of Porter will be moving to Cogos now.