During 2013-14, India Post had reported a negative growth of 2% for their parcel delivery division. However, for 2014-15, they have dramatically increased their parcel revenues by 37%; all because of partnerships with Ecommerce portals such as Amazon, Snapdeal and PayTm.
An official from the Communications and IT Ministry said, “Investment is being made for augmenting e-commerce parcel booking, transmission and secure handling capabilities and for mechanising delivery starting with the bigger cities. As a result of these efforts, the parcel revenues have jumped by 37 per cent in the last one year reversing the declining trend in postal business,”
Using Technology For Optimal Results
Since last year, India Post had launched several new initiatives to counter the onslaught of Internet and mobile based communication which resulted in dwindling revenues for them, especially from the sale of postage stamps, letters and delivery traffic.
Instead of fighting the inevitable technological changes, they focused on their strength, which was delivery of parcels, and it worked.
They collaborated with the top ecommerce companies such as Amazon, Snapdeal, PayTm and YepMe, and enabled a mutually beneficial mode of conducting business.
Besides, India Post also upgraded their technological capabilities, introduced Android app with real time tracking and postage calculator. India Post overhauled their overall infrastructure as they have set up 48 modernized delivery centers across India, which acts as hub of parcel delivery for ecommerce portals. Govt. has already announced an investment of Rs 5000 crore to modernize entire infrastructure, and Rs 2000 crore to purchase more delivery vans and vehicles.
Why India Post Can Be a Game Changer for Ecommerce Industry
As of March, 2014, India Post has 1.54 lakh post offices across India, with 1.4 lakh delivery post offices. Out of this, 89.86% of the post offices are in rural India, which makes them the biggest network ever created to ship products into the deep rural hinterland of India.
With over 2 lakh employees and 2.59 lakh Gram Dak Sevaks, an average post office in India serves 6193 people in rural villages, and covers 21.22 sq kms of space.
Any ecommerce observer will confirm the fact that the next wave of ecommerce growth is happening in Tier 2, Tier 3 and villages of India. And this is precisely the reason India Post was able to post a 37% growth in their parcel delivery section.
As per the trends, around 70-80% of their parcel deliveries must be happening within rural areas, as last year, they enabled CoD worth Rs 280 crore in rural areas for ecommerce portals.
And considering the exponential growth encountered by the Indian ecommerce industry, this is just the beginning for India Post.
Received a parcel the other day sent through registered post, which I had ordered from paytm.com. When I opened the package, I was shocked to find the original item replaced with two large books (exact weight of the original item; 1200 gm). Abstraction of contents is a big problem with India Post and highly unreliable for shipping high-value items.