Introduction to Hyperlocal Logistics in eCommerce
Every time you order food from a delivery app like Swiggy or medicines from 1mg that reach you before the end of the day, you’re either knowingly or unknowingly becoming a supporter of the hyperlocal logistics industry.
Hyperlocal logistics is a sector of the logistics industry that has had over $1 billion invested in it by various aggregators and delivery platforms over the past 5 years. And this industry is set to grow almost exponentially in the next half a decade. With the steady induction of online shopping into our day-to-day activities, convenience has become a way of life. And what has made the process easier has been hyperlocal logistics.
Hyperlocal logistics is all about rapid-fire demands, easy payments and light-speed deliveries. This has been a true boon during these trying times amidst a pandemic and multiple lockdowns. But if customers are getting deliveries this quickly, that means all backend operations have to be taken care of equally fast.
And the usual methods of logistics management may not all apply here. Hyperlocal logistics is a wholly separate and fully functional part of the logistics industry. This area of logistics is what we’ll be looking into today, from the unique factors that make it hyperlocal to the companies you can rely on to help you provide these services.
What is Hyperlocal Logistics
Logistics is viewed as the overall process through which we receive any orders we place online from an ecommerce business. As the ecommerce sector worked hand-in-hand with logistics companies to streamline the process of delivery, the avenue for hyperlocal logistics also opened up.
From food to pharmaceuticals, hyperlocal logistics makes use of local supplies and resources to give customers their products in record speeds. So is it the speed alone that separates hyperlocal logistics from run-of-the-mill logistics or logistics? We’ve analyzed the elements that create a hyperlocal logistics chain and found 5 clearly distinguishable factors, listed below, that enable hyperlocal logistics to act as its own industry entirely.
One major factor that distinguishes hyperlocal logistics from last-mile delivery and other types of logistics is the geographical distance that is covered in these types of deliveries. Hyperlocal logistics typically covers a range of only 5-15 km.
In some cases, services may be offered to enable deliveries for longer stretches between 20 and 40 kilometers. But the goal of hyperlocal logistics is to reduce the delivery distance and the delivery time, making small geographical ranges ideal for this type of delivery
2. Product Procurement
In the case of ordinary ecommerce logistics, a company would usually source their products from a single supplier or group of suppliers, then hold them at a storage facility near the supplier to be distributed from there. In the case of hyperlocal logistics, the products are often procured by local vendors and stored with local vendors. This makes the entire process of delivery within the locality of the vendor much easier.
3. Delivery Time
We've now mentioned twice that hyperlocal logistics' main selling point is fast delivery, but how fast are we really talking? Keeping in mind the time required for the delivery agent to bill and collect the item prior to delivery, the short distances involved in hyperlocal logistics usually make the delivery time within 45 minutes to an hour. For larger deliveries, such as with groceries, customers can schedule their deliveries for specific hourly time slots to ensure items that reach them are fresh and undamaged.
4. Types of Products
When you think about the deliveries you would make using hyperlocal logistics, I'm sure you'll find that they're limited to specific types of products. For example, you wouldn't be able to get a sofa on hyperlocal delivery.
But you can order pharmaceuticals and groceries. This is because hyperlocal logistics usually only works for deliveries under 10-12 kgs and for specific types of items that fall within the easy-to-move categories, like certain electronics and groceries.
5. Resources Utilized
A huge problem within the logistics industry is wastage and double use of resources. With hyperlocal logistics, the stock that typically goes unused or is in excess can be utilized. In addition to that, companies can turn to local vendors for delivery resources. A local store can then use its own employee force to fulfill delivery and gain an independent profit from this sale. This enables local vendors to use up their excess stock as well.
What is the Importance of Hyperlocal Logistics
The beauty of hyperlocal logistics comes down to how seamlessly hyperlocal logistics platforms have managed to integrate ground services with tech-enabled solutions. The purpose behind this is to create an experience that gives customers more transparency and visibility.
In addition to that, there are numerous minute details that can be better tracked and managed when dealing with deliveries localized to a specific geographical zone, as is the case with hyperlocal logistics. It is a combination of these factors and the benefits we’ve listed below that has been pushing a lot of ecommerce companies toward hyperlocal delivery.
1. Enhanced Customer Experience
Logistics in general is all about the customer experience because that's what separates the best from the rest. In the case of hyperlocal logistics, companies can get absolutely hyper about customer experience. In addition to a few of the benefits we've listed here, there are a multitude of ways that hyperlocal delivery helps keeps customers happy.
These include faster deliveries, fresh products, and scheduled drop-offs for convenience. Not to mention the fact that most hyperlocal logistics companies also collect feedback from customers to keep improving their services.
2. Support Local Vendors
As we mentioned earlier, local vendors play a huge role in hyperlocal logistics. And why wouldn't they? It's in the name after all. Local vendors are often the ones that procure and store the items for delivery, and they even use their own resources for it.
Through this process, local vendors can sell their goods through hyperlocal platforms, improving their productivity and thereby making them stronger in the hyperlocal logistics industry. This paves the way for ecommerce businesses to also make use of local vendors to sell their goods while also promoting both parties involved.
3. Faster Tracking
Since hyperlocal deliveries are carried out within specific localities, orders are typically placed on demand. Meaning that customers are placing these orders with the expectation that they will reach at the right time and with utmost convenience.
Customers like being able to predict when their order will arrive so they can be present for its arrival. That's why hyperlocal logistics makes use of GPS-enabled smart devices, RFID tracking and other tech-supported systems to ensure that customers can track their orders en-route and be prepared when they arrive.
4. Faster Delivery
I would love to say "Refer to point no.3 of the above section", but some points are important enough that they bear repeating. One of the key selling points of hyperlocal logistics for customers is that deliveries are usually completed within 45-60 minutes.
Customers also enjoy having the freedom to schedule their deliveries so their presence coincides with the arrival of the delivery. Even at its latest, deliveries are completed within a time frame of 4-6 hours when it comes to hyperlocal logistics, which can truly put same-day deliveries to shame as there is still a heavy element of surprise involved.
5. Lower Logistics Costs
Fulfilling orders at this fast pace may have you wondering how hyperlocal logistics manages to keep costs down. But as we mentioned earlier, hyperlocal logistics rely on utilizing all resources available and minimizing wastage.
So a combination of on-ground delivery force and hired delivery forces are used. Stock is usually made up of both shared supplies and held supplies from local vendors. And the use of technology for tracking and visibility ensures optimum convenience for customers which makes them more likely to pay higher delivery fees.
Top 9 Best Hyperlocal Logistics Companies for Your Online eCommerce Business
Hyperlocal logistics is not everyone’s cup of tea. This can be for a number of reasons, like the location of your target audience, the strength of your employee base, the distribution network you rely on for deliveries, and many other factors. Most logistics companies provide first mile, mid mile, and last-mile delivery services.
These are vital for transporting goods across long distances. Some companies even offer customs clearance services, which is a must-have for cross-border deliveries. While these are not involved in hyperlocal logistics, this sector of fulfillment does rely on other factors such as real-time tracking, delivery agent visibility and accurate scheduling, to name a few. That’s why there is a very specific range of logistics companies that handle hyperlocal logistics. Listed below are the top 10 hyperlocal logistics companies.
Bikxie was founded in 2016 to provide bike-taxi services and now specializes in hyperlocal logistics. It provides these services in a multitude of cities, starting with Faridabad and Gurugram, for a wide range of ecommerce businesses in India.
Blowhorn is a hyperlocal logistics company that uses a well-maintained fleet of vehicles to deal with cargos of different sizes. Its current 5-year goal is to go green with its transportation fleet. Out of the 50 million orders a month, over 86% of them are same-day deliveries.
Dropr was founded in 2019 and offers on-demand and same-day delivery in a multitude of locations. It provides a range of specialized hyperlocal logistics services like safety packaging and real-time tracking. These services extend to corporate and bulk orders.
Dunzo is a 2014-founded company that provides hyperlocal logistics services for 37000+ businesses, including ecommerce businesses, across the country. It employs over 6000+ delivery partners across 7 major metropolitan cities that handle 2 lakh orders a month.
Grab was founded in 2013 as one of India’s premier startups handling hyperlocal logistics exclusively. It offers on-demand and same-day delivery, ensuring pickup is carried out within 15 minutes from the time of placing the order and delivery is completed within 2 hours from the time of pickup. Intra-city delivery services are also made available for retailers starting out.
Pidge is another courier company that was founded in 2019 and currently operates across 5 major metro cities providing hyperlocal logistics services. Unlike most hyperlocal logistics companies, Pidge offers radius-free same-day and on-demand delivery. It also provides specialized services like temperature-controlled transit and special handling.
Shadowfax was founded in 2015 and provides a wide range of delivery services including hyperlocal logistics. Companies can opt for slot-based delivery, same-day delivery and on-demand delivery, as well as express hyperlocal which assures delivery within 45 minutes.
WeFast was started in 2016 to provide delivery services for on-demand and urgent orders. To that end, it offers both walking and riding deliveries as well as COD options for hyperlocal logistics. It also has other specialised hyperlocal logistics services like an option to select the store of your choice and choose multiple drop-off points.
XpressBees is a 2015-launched company that provides a wide range of hyperlocal logistics solutions to ecommerce businesses. It makes use of SMART transportation services to provide hyperlocal logistics services for both B2B and B2C companies.
List of Industries Impacted by Hyperlocal Logistics
Now that we've shown you all the appealing things about hyperlocal Logistics, we're sure you must be itching to know whether or not you can benefit from it. As we've mentioned before, there are numerous restrictions to hyperlocal logistics starting with geographical range.
But another major distinguishing factor is the size of the cargo being delivered. Extremely heavy cargo is a no-go for hyperlocal logistics. That's why you're likely never to see hyperlocal logistics available for heavy machinery or furniture. However, there are many industries that hyperlocal logistics is absolutely ideal for, so any businesses under these categories can make exceptional use of hyperlocal resources.
Pharmaceuticals are typically small, easy to carry, and absolutely essential. This makes them ideal for the hyperlocal logistics industry as it caters to a target audience that may be unwell or unable to traverse to the store and provides them a much-needed mechanism for submitting prescriptions and receiving medications.
Groceries include a wide variety of goods, both perishables, and non-perishables, but by and large, are usually essentials. This can include fruits and vegetables, cleaning supplies and other items of that nature. The nature of these items makes it absolutely vital to make use of hyperlocal logistics services, as many of the items are needed on an urgent daily basis and most may spoil if delivery is too slow.
Electronics are not exactly perishable goods but they do fall under the categories of high value and typically fragile. Most people will typically experience an immense amount of anxiety when they order a costly and delicate phone, and that anxiety won't subside until the phone has reached their hands. For situations like this, hyperlocal logistics is ideal.
Food aggregation services like Swiggy and Zomato are probably the most well-known examples of hyperlocal logistics services. They specialise in on-demand delivery, whereby the order is placed and then immediately fulfilled. The main reason for this is because people typically want to enjoy their food hot and fresh, making slow delivery options unviable.
Ecommerce businesses have also been extending their reach to include hyperlocal logistics services, making use of specialty carriers like shadowfax and dunzo to reach customers in different localities. The range of products sold by ecommerce businesses in this manner can vary from food, to cosmetics, to clothing, to electronics. But they follow the same pattern of local vendor procurement and then ground force on-demand delivery.
Hyperlocal logistics is a revolutionary new means of delivery that's taking the country by storm. When the pandemic struck, all panic was swayed only with the help of hyperlocal food delivery aggregators like swiggy and grocery delivery platforms like Grofers, Big Basket and Dunzo. Hyperlocal logistics has since become immensely popular and more companies are utilizing resources to provide these on-demand speedy delivery services.
For companies that may not have ground services in various localities to handle this volume and range of deliveries, you can rely on the top hyperlocal logistics companies listed above to give you that boost in sales you need. What makes hyperlocal logistics so absolutely vital is not just the fast delivery speeds but also the transparency afforded in the process. Customers can track their orders as they are en route and call delivery agents with instructions. This further simplifies the delivery process and allows fulfillment to max out. Hyperlocal logistics affords ecommerce businesses a chance to fully utilize all of their resources and keep customers exceptionally happy.