Thread by @baha1729

How did Delhivery become a logistics behemoth in India?

A thread 👇 (1/n)

Back in 2011, when Zomato was still a restaurant-listing platform, a couple of young guys had an idea to build a delivery network for restaurants. They built a company that became the “delivery boy” for restaurants.

And so, Delhivery was born.

But soon, the company spotted an opportunity in India’s burgeoning e-commerce industry where e-commerce delivery systems were slow and didn't match consumer expectations.

In order to fulfill these expectations, Delhivery went about building a network of warehouses, last-mile distribution, etc.

And now, it is one of the most successful ‘third-party, last-mile logistics delivery firm’ (3PL) for e-commerce.

In fact, ~20% of all e-commerce delivery volumes in India were found to be fulfilled via Delhivery.

And 60% of their revenues come from the e-commerce sector.

The only problem━ this means that the fate of Delhivery is in some ways intertwined with the fate of e-commerce in India.

Over 41% of its revenues come from just 5 entities. This could include e-commerce giants Amazon and Flipkart.

The problem here is that Amazon is building out its own logistics network to rival 3PL players in US. And it’s possible that they may follow a similar path in India.

And if this trend manifests across the industry, it could spell trouble for Delhivery.

So what can Delhivery bet on?

Well, India’s direct-to-consumer (D2C) companies.

These companies usually focus on offering a superior customer experience as opposed to figuring out the costs associated with maintaining a massive logistical arm.

And India’s D2C market could be worth $100 billion by 2025. Which is exactly what Delhivery is already betting on.

What do you think about Delhivery and its upcoming IPO?

By @finshots (n/n)