Is Next-Day Delivery About To Become A Reality in India?

A recent article over on Knowledge @ Wharton, which asked whether or not India’s Logistics Industry Could Deliver a Better Model for Transporting Goods, noted that G.R. Gopinath, who revolutionized air travel in India with Air Deccan, is starting Deccan 360 with the goal of connecting 75 cities in India to each other on a 24-hour delivery schedule within the next year. That’s an ambitious goal in a country where only 1% of the population travelled by air up until 2003, and where air travel is still restricted to about 5% of the population.

It’s also an ambitious goal considering that while you can often get a part from any major city in the world to Mumbai in 24 hours, it will usually take at least 72 additional hours to get it to its final destination. The article notes how it once took seven days to move a spare engine from New Delhi to Kolkata (which is approximately 800 miles or 1300 kilometres away) and that it was cheaper to transport it via Singapore (which increased the transport distance to at least 4367 miles or 7028 km) than to transport it within India at logistics costs that are among, if not, the world’s highest. (Logistics costs in India account for about 13% of India’s GDP.) Talk about taking a ride on the crazy train.

Right now, only Blue Dart, owned by DHL, is the only logistics player in India with dedicated cargo aircraft — all 7 of them, dedicated to a whole three routes! So what Deccan 360 is proposing is revolutionary in scope. Starting with three Airbus aircraft and a network of 30 franchisees, Deccan will start offering next-day connectivity to 30 cities next month. Over the next year, it will add two more Airbuses and four ATR aircraft and expand to 75 cities. It will do this by way of a hub-and-spoke model run out of a 100-acre state-of-the-art cargo handling facility in Nagpur in central India. And if it works, express will no longer be a fantasy in India.

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