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Live Mint – Connect India ties up with common service centres to grow reach

The logistics and last-mile delivery start-up seeks to expand its delivery reach to 3,500 locations from 1,500 currently

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Connect India E-commerce Services commissions neighbourhood grocery stores, medicine shops, cyber cafes and such outlets in villages and urban areas and delivers the parcels at these outlets. The owners of these outlets then deliver the parcels to customers.

New Delhi: Logistics and last-mile delivery start-up Connect India E-commerce Services Pvt. Ltd has tied up with common service centres (CSCs), implemented under the national e-governance plan, to expand its delivery reach to 3,500 locations from 1,500, a top executive said on Friday.

Connect India is a delivery firm which doesn’t employ delivery boys. It commissions neighbourhood grocery stores, medicine shops, cyber cafes and such outlets in villages and urban areas and delivers the parcels at these outlets. The owners of these outlets then deliver the parcels to customers.

The company was launched in August by L.R. Sridhar, who has worked with logistics firms such as Express Logistics, Skypak and Overnight Express Ltd for over three decades.

“It is difficult to scale up the delivery boys model. However, it is much easier to scale partners (outlets). These shopkeepers have unutilized assets. And the extra commission that they earn will go towards enhancing their livelihood. We call it entrepreneurship model,” said Sridhar, co-founder and chief executive.

“Our target is to established one-kilometre delivery areas in urban areas and the convenience of last-mile delivery in rural areas,” he added.

The company charges Rs.20-25 per delivery in metros andRs.50-60 for delivering in rural areas. It works on a revenue-share basis with partner outlets. “We share 40-50% of our revenue with the shopkeepers,” said Sridhar.

Connect India, which raised close to $5 million in July from venture capital fund Aavishkaar, also plans to raise a further $15 million and is in early-stage talks with institutional venture capital and private equity firms.

“We aim to close the deal by February-March,” Sridhar said.

The funds would primarily be used for enhancing infrastructure and technology.

The firm wants to expand to 50,000 outlets by the end of March 2017 by reaching out across the country, covering 26,000 postal codes. It claims to be delivering 10,000 orders per day for an average packet size of Rs.2,000-3,000.

According to Sridhar, the company is generating billing worth Rs.2-3 crore every month. It targets a revenue of Rs.50 crore by March.

Connect India on Friday also tied up with courier firm United Parcel Service of America Inc. (UPS). As a result of this partnership, all Connect India outlets can be used by customers who want to send parcels anywhere in the country or abroad.

The company also delivers products for e-commere companies such as Flipkart, Amazon, Voonik and Shopclues. It is in talks with Snapdeal.

“Connect India has a robust model of developing village level entrepreneurs to bring efficient logistics and reverse logistics to taluk and sub-taluk-level communities. We believe this could create substantial development and livelihood impacts in rural India,” said Vineet Rai, chief executive officer and managing director of Aavishkaar.

Priyanka Sahay