Freight Bazaar, an integrated platform that connects truck users and truck suppliers and facilities easy truck hiring process, has a technology driven processes that aids inter-city transportation like finding the right suppliers, real-time price discovery and post hiring processes.
During his professional stint, Ganesh Rewanwar came across issues related to logistics, mainly shipping materials to the right place at the right time. “I was working with Nagarjuna Fertilisers then and Urea was a precious commodity during monsoon season. Transportation was mostly happening over telephonic network and they used to find it difficult to go to multiple locations,” recalls he. That’s when he realised that technology is being used in the warehousing side of the business, while the suppliers and truck owners had very little use of technology in their business. “Stakeholders spend 50 per cent to 70 per cent of the time on truck, hiring and billing and payment and these can be handled through technology,” says he. And hence, he set up FreightBazaar along with Bhaven Shah in 2013.
FreightBazaar is an integrated platform that makes inter-city transportation process cost effective, professional and reliable. The truck suppliers get the benefit of regular as well as return loads through this platform while the truck users get to work with reliable suppliers. The company’s technology driven processes and customer service team facilitate the entire inter-city transport process from finding the right suppliers, to real-time price discovery and post hiring processes such as trip management, billing as well as payment processes.
While the company founders set up the company with their investment, they eventually raised money from friends and family. “Scalability becomes an issue once you reach a certain level and hence, we have started looking at fund raising for scaling up,” says Rewanwar.
The Business Model
“Earlier we had a different version of the website, which was more like a classified model where truck supplier and the shipper posted their requirement and got the contact details,” recalls Rewanwar. Eventually, the team realised that it is not sufficient to move forward and hence, decided to have an integrated platform which can handle right from publishing the requirement to payment. The beta version platform was launched in late 2015.
There are two components in this SaaS and market place platform. One, there is the market place where the shipper and supplier can post their requirement and book the transaction, and the other is where the trip can be tracked on the platform and the payment can be made through the platform. The shipper and the supplier will have the visibility on transaction and they can manage the business better through the technology component. There are various features provided to manage the transaction effectively. Some are related to transaction, while some pertain to the business and there are not many technology tools available to the supplier. There is a gap between the existing tools which can handle only up to procurements and people take the manual route to complete the transaction. “We streamline the transaction online and they need not go to multiple locations for the same,” says the co-founder.
On the shipper side, its customers are large enterprises and logistics companies while on the supplier side, it is the transporter, fleet owners and brokers. The company’s platform is open to all. However, its users cannot do the transaction without registration and for registration the company has a standard procedure and only those whose documents are verified can register on the company’s platform to maintain reliability.
Talking about what differentiates the company from the rest in the industry, Rewanwar says, “Many players are more like transport service providers. Our tools or platform enables the transportation activity.” The company has an asset light business model and offers transparency to the customer and supplier. “When we work with shippers, we are more like middlemen between the transport service provider and the shipper. Other players become another supplier to the existing supplier network. When we become a middleman, there are suppliers on our network and shippers network, the shipper can take advantage of the all the activities,” explains he.
The company does about Rs. 1.5 crore to Rs. 4 crore of freight business on offer every month. Some of its clients include Gati, TVS Logistics, ITC, Deolus, Nest, Crystal, RCI Logistics, Shreeji, KK Group, Amar Jyoti Logistics, UCPL Express Road Transport and Vikas.
Stakeholders spend 50 per cent to 70 per cent of the time on truck, hiring and billing and payment and these can be handled through technology
The progress report
Over the last two years, the company has kept a sharp focus on creating a sustainable business model. “ We have worked on building certain tools in the last 12 months and have seen a growth of around 30 per cent in sales,” says Rewanwar proudly. The company has a registered member base in almost 300 cities with more than 1200 registered members. “Together, the suppliers can transport more than 25000 tonnes through us,” says he. More than 90 per cent of the company’s business is repeat business and the company has business in 200 routes. It has done Rs. 10 crore of trade business in the last two years and is growing 20 per cent in its revenue on a quarter on quarter basis.
The company was recently invited for PM Narendra Modi’s ‘*Champions of Change*’ programme where the team made suggestions to improve the logistics infrastructure.It has signed a MOU with Domain and Functional Advisory Group (DFAG), a New Delhi based Non-Profit organization that is a key facilitator for Highway design and feasibility studies to spread awareness about transport emissions and trucking safety.
Not without challenges
But with every growth, comes its own set of challenges. “We are a start-up, operating in an unorganised segment. There were temporary challenge due to demonitisation and GST. However, we recovered from it now,” says the CEO.
The company has limited resources and manages its operations within it. The management took a conscious decision to manage its business within the available team size of 20 to retain its sustainable model and further scaling. “Good thing is that sitting in Hyderabad we are able to do the business in more than 200 routes. That’s the advantage of technology that we have to offer. With scale, we would like to deal with physical infrastructure at different cities across India and that will help us in moving forward faster,” says the co-founder.
“We are just serving 10 per cent of the demand on our platform,” says Rewanwar. The team wants to promote the technology component and also get more suppliers on board to meet the remaining demand. Over the next three years, the company aims to do 1000 to 2000 transactions in a day.
On a parting note Rewanwar says that there are multiple players in the industry and it is important to build an ecosystem rather than doing everything yourself. It is a fragmented and network based industry and it is very difficult to do the job by yourself. “Collaborate and perform.”
Founders: Ganesh Rewanwar and Bhaven Shah
Year of Incorporation: 2013
Funding: Self funded. Planning to raise funds
Profile: FreightBazaar is India’s largest online and integrated platform to connect Truck Users and Truck Suppliers and facilitate hassle-free and convenient Truck hiring process. It is a convenient platform supported with Risk mitigation tools, flexibility, secure payment gateway and excellent customer service. The company’s platform is open to a truck owner, transporter, small company, large companies, broker or an agent.