India Post, with more than 150 years of incredible services, a network of 1, 55,015 post offices across India, an online e-post office, along with facing stiff competition from private courier services, is ready to take one more step ahead with its entrance in ecommerce space.
Recently, Livemint reported that India post may offer logistic services to Indian etailers charging 6% of the value of a product as delivery cost. No extra charges will be there for handling cash or return as compared to private courier companies. Eretail, a channel much dependent on well planned and organised logistics and currently struggling with high shipping and logistics cost, also faces difficulty when it comes to cash handling while providing COD services.
With involvement of India post, it will be worth noticing whether it will prove an asset or not to the upcoming Indian ecommerce industry.
Looking at both sides of the coin, we find that India post with its wide network in both urban and rural areas along with its mechanism to handle money orders could prove quite useful in increasing the reach of the etailers along with solving problems linked with COD. On the other side, Indian Postal Service is known for its delayed delivery, high transaction time at counters, unorganised remittance services and year by year annual losses in crores.
However, it feels that now India Post has understood the importance of ecommerce space in current scenario to stay in the game. A few days back, it was reported that Indian post had a 1400 cr deal with TCS to computerise and upgrade all its offices , services provided and also to introduce ecommerce solutions. Also in Union budget 2013, government assigned INR 4909 cr to modernize the postal network. In year 2008, India post started with Project Arrow worth INR 9.8 cr, to bridge its weaknesses.