The Indian arm of global e-commerce titan Amazon has expanded the scale of innovative delivery models such as ‘I Have Space’ (IHS) and Service Partner Network (SPN), to increase customer reach and ensure on-time deliveries.

Under the IHS programme, kirana shop owners use extra store space for Amazon packages, which they deliver to customers within a 2-4 km radius, for a fee. While the store owner earns extra income, the programme also spawns employment opportunities for youth.

‘Jobs galore’

Chinna Rao and his son Ganesh, took home a paltry ₹8,000 a month, running a small vegetable shop in Visakhapatnam. After enlisting with the IHS programme, the father and son have been earning an additional ₹12,000 per month over the last 12 months.

“IHS has grown from 12 stores in Bengaluru in 2014 to a network of 12,500 stores pan India that serve 180 cities with the majority in tier II and III towns,” Akhil Saxena, Vice-President, India Customer Fulfilment, Amazon India, told BusinessLine . “ Kirana store owners earn on average ₹12,000-15,000 per month and hire 1-2 delivery boys, generating 12,500-25,000 jobs.”

Spawning entrepreneurs

Chennai-based mother of two, Jamuna, heard about Amazon’s SPN programme from a friend and set up a 650 sqft delivery station in Manapakkam last February, employing nine women aged 24-36 years, to deliver Amazon packages to customers in Ramapuram.

“We deliver over 100 packages per person per day on good days and about 30-40 packages on regular days,” said Jamuna, who earns ₹15,000-25,000 a month from Amazon deliveries.

“SPN was born in August 2013, with one service partner in Pondicherry and has grown 1.5 times over the last year to 250 service partners today,” Saxena said. Amazon also operates 150 delivery stations, and the SPN model is being emulated in various forms in emerging markets today.

To ensure smooth, last-mile delivery, Amazon started bicycle deliveries in Mumbai last January and has extended it to Surat, Chennai, Pune, Delhi, Hyderabad and Bengaluru. “We added bicycle deliveries in congested cities to augment our two-wheeler and van deliveries” said Saxena.

The e-tailer also uses the services of third-party providers such as DHL, Blue Dart, Gati, and India Post as delivery channels. It will have 41 operational Fulfilment Centres in 13 States with over 13 million cubic feet of storage space by the festive season, for its 2,00,000 sellers.

“As e-tailers strive to shore up sales, they have to own both the online shopping experience and the supply chain/physical delivery experience in order to increase customer reach and wallet share. IHS and SPN are a step in the right direction,” said Vidhya Shankar, Executive Director, Grant Thornton India.

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