A.P. Moller – Maersk (Maersk) has made a significant move towards revolutionizing e-commerce logistics in India. Their innovative approach, called the ‘One Country, One Price’ e-fulfillment solution, aims to simplify the complex logistics landscape for small and medium-sized e-commerce businesses in India. This solution offers a comprehensive range of services at a flat rate of $1 per order. It includes 60 days of storage, delivery across 18,000 pin codes in India within 48 hours, a 20% return to origin (RTO) rate, and no fixed monthly costs or minimum orders. This strategy addresses the fragmented market and supply chain complexities hindering many businesses’ growth in India.
The Indian e-commerce market shows immense potential, highlighted by the India e-Conomy Report 2023. The report reveals that Indians spend an average of 6.5 hours per day online, with 220 million online shoppers recorded between May 2022 and May 2023. Additionally, there are 700 million internet users in India, half of whom use digital payments. This data underscores the significant growth opportunities in the Indian eCommerce sector.
Maersk’s expansion in India includes doubling its warehousing business, following the acquisition of Hong Kong-based LF Logistics. By the end of 2023, Maersk aims to expand to more than 5 million square feet of space across India, adding 14 more states to its network. This expansion aligns with Maersk’s strategy to provide multiple speed and capacity options to customers, positioning its facilities near consumption and manufacturing hubs as well as in all metro cities and major Tier-II cities in India.
In terms of its operational footprint, Maersk has been present in India for around 20 years, providing services across 15 of India’s main ports, 45 inland acceptance depots, and 25 sales offices. The company’s strategy includes a variety of warehousing and distribution services, such as consolidation and deconsolidation warehouses, transportation offerings, and a fulfillment network with different speed options (e.g., 3-day, 1-day, or same-day delivery).
Maersk’s approach to warehousing and distribution in India involves building some warehouses and distribution centers on its own, collaborating with inland container depots (ICDs), and leasing facilities. This strategy aims to fill the gaps in its integrated logistics offerings to customers. Importantly, Maersk’s plans are customer-focused and tailored to suit specific supply chain needs, avoiding speculative investments in warehousing and instead focusing on customer-driven requirements.
This comprehensive strategy by Maersk indicates a strong commitment to transforming the logistics landscape in India, offering streamlined, cost-effective solutions tailored to the needs of the booming e-commerce sector.