The lockdown in the country has profoundly disrupted the supply chain for goods delivery because of a shortage of staff as migrant workers have left for their home-town. Sourcing of the raw materials and distribution of the finished good are the areas in the supply chain, which got disrupted.
Companies are searching for all the new and innovative ways to ensure an uninterrupted supply of daily essentials. In this article, we will talk about some of the changes induced in the business models to function during this difficult time.
FMCG Direct Delivery
In the time of distress due to COVID, many FMCG companies have opened up for direct delivery of their products. Big FMCG companies like ITC, Hindustan Unilever, Procter & Gamble, Colgate, and Dabur have skipped the traditional distribution networks to enter the last-mile delivery to deliver their products directly to consumers.
ITC Limited, an Indian multinational conglomerate with revenue of 7.3 billion US dollars, has started to sell products online through its portal. Some of the ITC brands which can be ordered online are Aashirvaad, Savlon, Classmate, Natural, and Engage.
COVID-19 has forced FMCG’s to come out of their confirmed zones to the Direct2Customer (D2C) delivery system, which allows FMCG firms to fill gaps in distribution due to lockdown.
Some of the FMCG’s have also taken the route of AI chatbots by signing with Bengaluru based startup Yellow Messenger to sell the products directly to the customers on WhatsApp. Most of the Indians nowadays are accustomed to the use of WhatsApp messenger, and it is
very convenient for the customers to choose products, quantities, and time of delivery in the WhatsApp chat with an AI bot.
Direct transfer creates a sense of safety among the customers as they order from the brand they trust, and there are not many hands involved in the delivery of the products which drastically reduces the chances of contamination of food and beverages.
Consumer goods companies have begun to use newer linkages with hyperlocal apps (i.e local delivery of products in the smaller focused area) and courier firms instead of depending on wholesalers, distributors, and retail stores, which is re-shaping the old model of distribution.
Marico Ltd, the producer of Saffola cooking oil, reached out to Swiggy and Zomato in the initial days of the lockdown itself, sensing the need for its brands. Soon, it partnered with courier firm Lalamove, logistics firm Delhivery and B2B delivery firm Shadowfax.
Similarly, Britannia Industries has declared its partnership with e-commerce platform Dunzo to distribute its goods. With this partnership, consumers can get Britannia biscuits, cakes and milkshakes by merely placing their orders in the Britannia Essentials Store on the Dunzo app, and Dunzo promises to pick them up from the most proximal Britannia distributor and deliver within few hours.
Due to a significant rise in demand for at-home delivery, FMCG has risen to leverage Dunzo’s innovative and advanced technology platform to enable the seamless distribution of products daily. These platforms are working round-the-clock to respond to the current situation caused by Novel Coronavirus through innovations so products can safely reach to doorsteps.
ITC has also formed associations with delivery apps of pizza chain Domino’s, Swiggy, and Zomato, apart from directly taking orders through its website to diversify its distribution channels.
Hyperlocal partnerships offer convenience to customers as well as earnings to delivery partners in this tough time of the Indian economy. The firms use their vehicle networks for delivery of the goods to meet the 3X surge in demand.
These partnerships are a sign of collaboration, which is needed to solve a more significant problem of fulfilling the needs of the nation.
“In times like these, companies like Dunzo should be leveraged – to be able to deliver essentials like medicines to the elderly or groceries to families – so the majority of people can stay indoors. And so, it becomes even more important to work with local authorities and the government to find ways to meet people’s needs and provide essentials,” says a Dunzo spokesperson.
Common Service Centre for Rural Areas
suppling essentials that can take orders online or offline and facilitate home-deliveries.
The initiative led by Common Service Centre plans to reach 60 crore people in tier-1 and tier-2 cities through 3.8 lakh outlets. These outlets will be set up and run by private individuals, however, under the support of the Ministry of Electronics and IT. The CSC will be engaged in the sales and supply of essential products such as vegetables, milk, fruits, and pulses.
CSC, in collaboration with village-level entrepreneurs (VLE), has launched an app from where customers can order essentials online. Each VLE has been allowed to cover a radius of 5-10 km. The retail chain has crossed 5000 orders of value 20 lakh rupees so far.
Common Service Centers (CSCs), a Digital India initiative, are creating a silent revolution in ICT, particularly in rural entrepreneurship, says CEO, CSC, Dr Dinesh Tyagi, in an exclusive chat with Gautam Debroy of Elets News Network (ENN)
Big companies and modern start-ups fail to reach villages due to the harsh terrain and absence of proper addresses. Here, CSC is an excellent initiative to fulfill also the unique needs of the consumers, such as the availability of animal feed apart from the other essentials.
VLE provides an invaluable opportunity for encouraging entrepreneurship among rural India and also to give a source of income to migrant laborers flinging back to their villages.