A higher influx of orders is the true sign of a growing business. But as a wise artist once said, “Mo’ money, mo’ problems”. By which I mean, as wonderful as revenue is, when the cash flow suddenly starts to pour, you’ll have a lot more to think about. To handle this new heavy flow of orders, multiple courier partners will be required to serve a wider range of locations. Shipping costs still have to be kept within certain limits to maintain that magnificent profitability you strived for.
For a relatively young but quickly growing company, say with a GMV of less than 10 lakhs, the need for multiple courier partners can become an urgent one. But sourcing out and selecting viable logistics companies in India can be quite a time-consuming task. As an SMB, you may not have the time or the resources to go through the process of discovery with different shipping companies. As a blossoming entrepreneur, you’ll already have a long list of tasks that rolls to the floor. So how do you get swift and simple access to numerous courier partners based on their pin code serviceability?
This is where many small e-commerce companies have begun turning to courier aggregators. Courier or shipping aggregators provide a single platform that ties up with many courier partners. It cuts out the extra burden of scoping out various courier partners that serve your locations and then creating independent agreements with each of them. The use of an aggregator helps you fulfill an immediate need for multiple courier partners. However, it comes with a multitude of boons and banes. To familiarise you with the subject, we'll be discussing:
What are Courier or Shipping Aggregators?
Courier aggregators (also termed as shipping aggregators and logistics aggregators) are companies that tie-up with multiple courier companies for the purpose of providing e-Commerce logistics solutions. They enter into agreements with a wide variety of courier partners. The purpose: to bring shipping partners to a single platform and enable e-commerce businesses to easily select and onboard with multiple courier partners.
For any e-commerce company that is just starting to experience a heavier inflow of orders on a regular basis, a logistics aggregator can be an easy way to tie up with multiple partners for the first time.
Depending on the aggregator you choose, you may have access to a variety of services. Some offer technology-enabled solutions that further ensure efficiency of operations in the long run. ShipRocket is an aggregator that prides itself on having efficient reconciliation systems while Vamaship focuses on trying to keep prices cheap.
What are the limitations of using a shipping or courier aggregator?
The purpose of using a courier aggregator is to ensure cost-effective and efficient fulfillment of orders with the help of multiple shipping partners. However, tying up with a courier aggregator can have just as many challenges, albeit slightly different ones, as when you tie up with a new courier partner. They would therefore need to be considered and addressed prior to signing up with an aggregator.
1. Negative Customer Impact
The most important thing for any e-tailer is to keep their customers satisfied. A customer that receives regular standardised updates about the status of their order will likely remain calm. Frustrations arise when an order is being delayed, or in case there’s some issue with the delivery.
Even those frustrations can be appeased when you, as a company, can address them to your customer in a timely manner. Even in case of difficulties during the delivery, customers will continue to have faith in the rapid response of your team.
When using courier aggregators, there is an additional layer of communication thrown into the mix. In the original cycle of order delivery, orders are placed by a customer to the company. The company informs the courier partner who proceeds with pickup and delivery of the item. When the item is delivered, the courier partner will inform the company.
In case of any delay or customer complaint, the company will inform the courier partner. It is already a many-layered process with room for miscommunication but most kinks have been knotted out of this system. When an e-commerce company uses a courier aggregator, all communications now have a new channel to go through.
In case a delay in delivery leads to a customer complaint, the e-commerce company must first inform the aggregator. The aggregator will only then instruct the courier partner to take notice of it. This is extremely problematic because this can increase the time it takes for information to pass. Each player will pass on the information at their pace, which is dissatisfying to a customer that is relying on your company for speedy delivery. This can also make it very difficult to solve and identify problems in the delivery process at regular intervals.
2. Limited selection of courier partners
Courier aggregators can partner with a varied number of shipping partners. This can range from anywhere between 10 and 20. Though 20 may seem like a large number, your selection will be dependent on other factors. These factors can range from locations served to specialized requirements during transit and even post-delivery, like COD reconciliation or efficient returns management.
Many aggregators also prefer to work with well-known courier partners. While reputation is a thing to consider, there are numerous niche courier partners that handle specialized services that you might be missing out on. The selection process is made easy using courier aggregators but only because the choice of courier partner is extremely limited.
3. Double costs
At the end of the day, courier aggregation is a business just like any other. There is a bottom line that needs to be met. A high volume of orders usually does allow an aggregator to offer reduced shipping rates. However, additional expenses are known to unexpectedly arise in numerous different situations.
For example, a courier aggregator that claims to offer COD services may not specify that some courier partners charge for handling cash. After all, it’s still offered. There may also be other subscriptions or even sudden price markups that can occur while using a logistics aggregation platform like ClickPost that may result in extra costs to your e-business.
4. Cheapest versus Best
Courier aggregators may pride themselves on offering the best prices available with their partnering carriers. However, they may not give you the information you need to know which courier partner is right for your requirements.
This is especially so in the case of specialized needs like SDD, NDD or temperature-controlled shipments. Pricing is often placed at a higher priority than reputation of the shipping company or services offered. A courier partner may be equipped to deliver to a remote location. They may not be equipped for reverse logistics.
The result is that a product may be lost during the return process, leading to a dual loss for your company. While keeping shipping rates low is an important aspect of your company’s growth and profitability, keeping overall costs low is also important. And optimum utilization of resources is a must. An aggregator’s focus will be on simply ensuring that a courier partner services your required locations at low prices.
5. Long Term Feasibility
At the end of the day, courier aggregation gives you an easy and quick way to tie up with multiple courier partners. This allows you to fulfill the sudden wave of increased orders your company has sourced. But for an e-commerce company, growth is a never ending process.
As your profit margin begins to rise, your needs become more specific. While courier aggregators may be the quickest way to meet rising demand, they are not often the most efficient. When your GMV hits 2-3 lakhs, a logistics aggregator will help keep you steady.
As your volume of orders increases, you’ll find more viable strategies and solutions to deal with distinct needs in certain defined areas. Like a high volume of COD orders coming in from a specified area, or perhaps certain pin codes that have been raising their demand for hyperlocal or SDD.
When you reach a higher volume like $1 million GMV, the need to look for direct relationships with courier partners to fulfill these predetermined requirements will arise. Maintaining independent contracts with eCommerce logistics partners will allow you to drastically improve customer experience, reduce your RTO%, and address other challenges pinpointed by you.
Why do e-commerce companies choose to use courier or Shipping or logistics aggregators?
The most basic reason why an e-commerce company would need to make use of a courier aggregator is because of sudden expansion. Think of your company like a child going through an incredible growth spurt.
It’s a joyous occasion for sure, but you need a short term solution to deal with your immediate needs and keep orders flowing. Basically, the old clothes and shoes just aren’t going to cut it anymore and you’ve got to get new ones quickly. The first place you run to is a mall, our emergency repository of shops. You can get what you need to get through the next few months at the very least.
During sudden growth spurts like this for your company, using a courier aggregator, a repository of shipping companies, can be beneficial. It offers up a bundle of courier partners in a single place. They simplify the process of tying up with them so you can focus on getting the orders to your customers.
Customers can remain happy while you determine the logistics strategy you’ll need for the long haul because the growth isn’t (and shouldn’t be) stopping here. Aggregators allow you to find new courier partners and fulfill existing orders quickly. Here are some of the reasons why an e-tailer may opt to use a shipping aggregator in India.
1. Easy selection of courier partners
By the time you approach a logistics aggregator, you will already be aware of the number of orders that need to be fulfilled, the areas that need to be services, and the speed of delivery that you require.
Most shipping aggregators categorize their courier partners on the basis of pin codes serviced and costs, so it’s simply a matter of selecting the ones that fulfill your base requirements. That being said, aggregators may not be equipped to offer specific services or even a larger scale of services with certain courier partners. At these times, independent agreements may be more effective for ensuring complete fulfillment of orders.
2. Lower shipping rates
Aggregators typically create their own monetary relationship with each courier company. The shipping companies can therefore offer lower shipping rates to e-commerce businesses, because certain other costs are covered by the aggregator.
However, reduced shipping prices are usually based on a high volume of orders, which not all aggregators are necessarily equipped to handle. In case of such high volumes, directly tying up with a courier company may be more cost-effective as there is no middleman involved.
3. Broad pin code reach
Using a shipping aggregator allows you to select courier partners based on their pincode serviceability. Most aggregators provide a platform to view the locations serviced by different shipping companies. Accordingly, you can choose courier partners based on the areas they service.
This is beneficial in case you need to service multiple locations across the country. It’s important to remember though that different aggregators, much like courier partners, tend to vary their services. Some aggregators offer better hyperlocal or door-to-door service, rather than a wide range of locations.
4. Easy Access to Order Information
Perhaps one of the biggest benefits of using a courier aggregator is being able to easily view order information with all courier partners from one place. Aggregators make use of multifunctional platforms to enable the status of all orders with various courier partners to be easily viewed from a single platform, instead of through respective courier partner websites. Logistics aggregators may have varied mechanisms for this though, much of which is dependent on communications from the courier partners. So the information being received may not be standardized and therefore, somewhat confusing.
5. Choice of payment options
This is a fairly simple and straight-forward benefit. More access to more courier partners means greater variety in terms of payment options. You can select courier services that specialise in cash-on-delivery services as well as others that offer various prepaid options.
However, determining which courier companies offered are also equipped to handle COD reconciliation or returns management in case of failed deliveries is not a task made easy on aggregators. In situations like this, performance monitoring is usually the only option provided.
List of top 7 Best courier or Shipping or Logistics aggregators in India [2021 Updated List]
As a growing e-commerce business, it is an absolute must to be aware of who you are entering into business with as well as who you aren’t. Courier aggregation is a vital part of many businesses ascension to expansion.
Based on what was discussed above, there are numerous elements that make a logistics aggregator ideal for your business needs. These include the number of shipping partners, the range of locations served, reduced shipping rates, and additional value-added services. Keeping those in mind, and overall performance, these are the top Logistics Aggregators in India.
Ship Rocket is probably one of the most well-known names in logistics for e-commerce businesses, both in India and abroad. Tied up with 17 courier partners, their reach extends to over 200 countries. Within India, they are a leading logistics aggregator. ShipRocket’s strength lies in a wide coverage for COD orders and the most cost-effective prices currently on the market.
They have been appreciated for their tracking platform and visibility, though some have raised concerns regarding their COD reconciliation process and customer service. They also promise a reduction in RTO percentages by approximately 2% to 5%. Ship Rocket allows their clientele to subscribe to payment plans that are based largely on the volume of orders. This enhances their capacity to cater to small and medium enterprises.
One favorite feature of Shiprocket’s customers is their comprehensive Dashboard. According to customer reviews, the Ship rocket dashboard allows onboarded e-commerce businesses to track products independently and ensure their delivery.
It also provides separate viewing information for non-delivered products, Cash-on-Delivery orders, and weight-based shipments. While they provide extremely efficient and cost-effective end-to-end delivery services, customer feedback shows their reconciliation process can often be delayed.
Vamaship is another international logistics aggregator, much like ShipRocket. Also like their competitor, they are known for their low shipping rates and easy view of multiple courier partners. They also offer the option of paying only for shipments and not for overall platform usage. Their onboarding process is simple and quick, and they cover a wide range of pin codes. However, their COD reconciliation and returns management system remain to be streamlined.
Shipdroid is a logistics aggregation platform launched as a service by e-commerce company Infibeam, shortly after Kartrocket launched ShipRocket. Their essential goal is to create uniformity in the logistics processes, and handle everything from ease of accounts management to printing of shipping labels, even for COD orders. Like all aggregators, they offer low shipping rates, a streamlined tracking platform, and online merchants using their platform are given the option to choose their preferred mode of transport.
ShipYaari is India’s first and oldest shipping and logistics aggregator. Their prices are not quite as competitive as ShipRockets and they have fewer courier partners tied up with them. However, they still have an extremely wide reach, offering COD for over 19000 pin codes and prepaid shipping for over 25000. They have also been commended for their overall efficiency, their patient customer service, and their effective handling of both forward and reverse logistics.
ShipKaro is another leading logistics aggregation company that caters to e-commerce firms in India and abroad, working alongside 13 courier partners. They offer low shipping rates and a well-managed COD support cycle to deal with reconciliations. There are 3 major options for plans that they offer to suit small, medium and large enterprises.
They also offer contract-based services as well as shipment-based payments, which allow you to pay on the basis of total number of shipments. This company is well-liked for its automated and scheduled system for end-to-end logistics, which allows e-commerce businesses to optimize delivery speeds.
Shyplite is another company high on the list of ideal logistics aggregators, and provides a single-window shipping platform integrated with 16+ carrier partners. Their main selling points are their unified viewing platform for multi-carrier orders and their quick and efficient customer support team. Their custom tracking page and trained team of 100+ employees has enabled them to serve major online retailers like HomeTown, Superbottoms, and MyPhotoPrint.
7. iThink Logistics
iThink Logistics is a courier aggregator that is quickly rising up in the ranks. Though their rates aren’t lowest in the market, they still provide cost-effective logistics services with a few other seemingly minor but still important benefits.
Their remittance cycle is shorter than that of ShipRocket, completing within a 7-day period. Though they are tied up with only approximately 10 courier partners, they are known for timely deliveries. An additional benefit that allows them to stand out is that they provide customer and business notifications through email, SMS, and Whatsapp.
Final Concluding Note
Courier aggregators provide e-commerce businesses a sure-fire way to tie up with multiple courier partners in the quickest time and manner possible. While they cut out the process of independently contracting with different courier companies, this can often result in problem areas being left unattended.
As your company grows, the need to maintain direct and independent manageable relationships with carriers also grows. The challenges to delivery and logistics increases along with your GMV and volume of orders. Accordingly, more complex and strategic shipping solutions are required. Aggregators provide an excellent medium during these periods of growth to ensure your business doesn’t suffer losses due to a base lack of order fulfillment.
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