By all indications, the recently-introduced Goods and Services Tax is expected to benefit the logistics sector, with rating agency ICRA expecting it to grow 9-10 per cent in the medium term. The sector holds promise for a number of start-ups. One of them, Porter, seems to have established a reputation for itself among small businesses. Its on-demand services are reportedly bringing in a healthy share of revenues.
Porter provides tech-enabled intra-city logistics services to 50,000 regular clients, also drawing one lakh one-time users, and is supported by some 6,000 small truck drivers.Small and steady
On serving a diverse set of SMEs, Pranav Goel, co-founder and CEO, says, “Our on-demand services are suitable for smaller SMEs as they don’t have a fixed requirement and can’t afford to have vehicles on a monthly engagement. Our larger SME clients opt for a fixed monthly engagement which is served by our institutional offering.”
Porter says it has crossed 1.5 million bookings and is growing monthly at 10 per cent. With its on-demand services accounting for well over half its business, Porter depends on patronage from very small businesses too. Roughly 20 per cent of Porter’s SME clients are small family businesses and 80 per cent are small retailers and distributors.
“The gap in on-demand services has benefited us. We were able to plug the gap by bringing in transparent pricing, reliability and convenience for our small and medium SMEs,” Goel explains. He adds that although Porter experienced a 15–20 per cent dip in orders early last week soon after GST kicked in, things have now stabilised.Steady at five
It’s also worth noting the pace at which Porter has chosen to grow since it kicked off business in 2014. Porter is currently concentrating on firming up its position in Mumbai, Delhi, Bengaluru, Chennai and Hyderabad and hopes to enter Pune and Ahmedabad by this year-end.
Porter’s founders have taken a stand against overloading of trucks to curb pollution and improve road safety without taking their eyes off “productivity metrics”. This, in turn, impacts driver motivation and incomes positively.
“We’ve been able to increase the utilisation of vehicles from one trip a day to more than 2.5 trips a day. We’ve reduced the loading and unloading time by 1.5 hours each trip, idle time between trips has been reduced from 3-4 hours to around 30 minutes because of our large customer base,” Goel says.