Sometime in June this year, business publication, Stears Business published an in-depth analysis on the challenge of logistics in Nigeria as it affects the eCommerce industry.
Dellyman is happy to have been mentioned as part of the solutions to the seemingly intractable challenge of logistics in the industry. We are grateful to Stears Business.
What we have set out to do with Dellyman is to confront the challenges in the last mile logistics industry head-on by guaranteeing same-day delivery for anyone wishing to move packages in Nigeria and across the African continent. Let me share an experience that motivated me into launching Dellyman.
I had just purchased a new laptop but also needed a licensed Microsoft Office software to be installed on this new system. It was a Wednesday and I figured if I got the Office software delivered by the weekend, I would have enough time to install it, move my files from my old system and do some productive work.
So, I ordered and paid for Microsoft Office 2016 from Jumia and the platform promised delivery would be within 1-3 days. So I hoped I could get it on Friday or in a worst-case scenario on Saturday morning. Sadly, it never arrived all through the weekend.
That meant that I could not effectively use my new laptop since I didn’t get the Microsoft Office 2016 delivered, even though I had paid for it. That money would later be used to purchase something else on Jumia. This is an all too common experiences for many online shoppers but for me, it was a disappointment I was not prepared to continue to live with.
This issue of delayed delivery is pervasive across the eCommerce industry with provider of service struggling to deliver packages in good time (especially same day or next day). And that is probably the number one reason we launched Dellyman; to attempt to guarantee a same-day delivery especially for priority and time-sensitive packages.
Many people are not sure what Dellyman is and why we launched. Well, Dellyman is an asset-light logistics marketplace. Unlike your regular delivery guys, Dellyman is made up of hundreds of last-mile delivery companies.
Arriving at this model was not by chance. It came after a comprehensive study of the last-mile delivery value chain and interrogating the challenges that bedeviled it. And I would share some of those findings.
We found that the logistics market is broken due to a number of reasons. First, we operate in an environment of low trust. Promises have been broken and nobody trusts that if they pay for delivery, the package will arrive as promised. Sometimes that distrust has been planted by a seemingly harmless lie by a rider who is at Ajah but tells a customer that is expecting a pickup or delivery in 10 – 15 minutes in Ikeja that “he will soon be there”.
And there are more serious problems where the goods never arrive because some riders will just disappear with customers’ packages.
The industry has not given the kind of assurances that the customers need to be able to trust last mile providers a bit more. This could be because there are no consumer protection regulations and/or that they are not well enforced. So, there is a problem of trust and that was the first thing that we found.
We also saw that even though the eCommerce retail market is on the rise, the assets which fuel the supply side of the industry were not growing at the same rate. This may be because serious players are yet to make the necessary investment in the industry. And unless sufficient assets are made available to meet the growing demand for eCommerce, last mile logistics will remain broken.
There are other problems as well, including the need to leverage technology, create transparency and provide excellent customer support.
Delivery is about keeping promises. When customers are promised quick pickup and timely delivery, they (the customers) also make the same promises to their own customers (especially in situations involving merchants selling goods). The industry needs trust in order to thrive and keeping to delivery promises across the entire ecosystem engenders that trust.
The Dellyman Solution…
Having interrogated the problems of lack of trust, insufficient asset, idle capacity, etc, the first thing we sought to do was to gain back consumer confidence. This means a situation where a customer would be able to trust that every company listed on the Dellyman platform is fully verified, for safety and quality service. We are able to share information with customers about our partnering companies’ abilities and capacity to deliver quality and prompt services.
The Dellyman platform ensures the entire process of pickup and delivery is transparent with complete traceability. In the sense, a customer is able to see the entire delivery journey from sender to receiver of the package. Our technology solution allows the delivery companies (and their drivers/riders) interact with each delivery order as well as the sender and receiver of the package from pickup to delivery. Customers know the status of their orders and whether they are assigned to riders, picked up and in-transit, delayed or delivered etc. Our offline and real-time tracking tools ensure the customer is never left in the dark.
The Dellyman aggregation model speaks to the issue of capacity. By aggregating logistics assets into a single market place, we can better guarantee availability of assets to customers seeking delivery of packages on our platform. Today, we have onboarded over 600 logistics companies with at least 150 of these fully verified.
Once onboarded and verified, the logistics companies get access to our robust technology so they don’t have to build or own one. This means that they can onboard and track their riders, set their prices and manage delivery orders seamlessly from pickup to delivery. When customers initiate a delivery order, we match them first with delivery companies with assets closest to the pickup location to reduce pickup time. Additionally, we provide data such as number of completed deliveries, distance of the closest rider or driver to pick up, social proof (ratings and reviews) from customers who have used the services of each listed company in the past etc.
Driving profitability for logistics players using the Dellyman model
There are three legs to a typical delivery. The first is the distance between the rider and the pickup; the second, the distance between pickup and delivery, and the third leg (what I call going back home), is the distance between the delivery and the logistics provider’s default location. Interestingly, the only billable leg is the second leg, that is from pickup to delivery point.
The problem with being able to bill only one of the three legs in the delivery journey is that the logistics company will bear the cost of travelling the distance to pick up. Sometimes this could be a distance of 30-40km depending on how far the rider is to the pickup location. Apart from the delay in pickup, the cost of fueling this leg of the journey impacts the profitability of the logistics company.
The third leg of the journey (going back home) is even more costly. The reality that a rider could travel back empty after delivery is scary. For most delivery companies, idle capacity remains the bane of growth and profitability.
Kabu Kabu or Uber for Logistics: While Dellyman is using aggregation to solve capacity, it is leveraging geofencing technology to guarantee faster pickup and asset optimization (by reducing idle capacity). We are the Kabu Kabu or Uber for logistics
A Kabu Kabu cab driver sets out from Ikeja with his first passenger going to Lekki. At Maryland, he might encounter a new passenger going to Surulere. And yet another customer heading to Obalende from Yaba. He is picking and dropping passengers along the way.
By the time the driver arrives Lekki, he may pick passengers heading out towards Apapa. And the process of pickup and drop-off continues until the driver is done for the day. So we see the possibility of a Kabu Kabu completing 30 – 40 drop-offs in a day without necessarily staying in a park to be loaded with passengers. He only goes back home when he is done for the day. This is the same model used by Uber taxis.
Our Uber for logistics model ensures that delivery assets don’t travel back empty after each delivery. This helps the return on investment for an average delivery company and they can continue to maintain their assets and invest in new assets. The more assets they contribute to the ecosystem, the more it helps capacity and coverage. Ultimately, the Customer is able to purchase prompt and efficient delivery service at an affordable price.
Transparent billing: Today customers bargain delivery prices with service providers. With the proliferation of logistics companies in a market with no barrier to entry and poor regulation, this sometimes can be to the advantage of the customers. A better and more transparent approach to pricing is to bill based on distance, traffic, weight or size of package etc. For our light assets (such as bikes) we have adopted a distance-based pricing model that applies rates on the distance between pickup and delivery calculated by google map.
Each logistics company on the platform is able to set their price and when customers book for service, they do not have to worry about negotiating price since the price from each provider is automatically displayed at the time of booking the delivery order.
The future of eCommerce: The eCommerce market is increasing in its attractiveness due to convenience, good shopping experience, ability to view and shop for unlimited products across several channels (omni channels) as well as multiple and secured electronic payment options. While shopping online guarantees comfort and convenience, customers’ expectations to have access to their purchases as quickly as they would if buying from a traditional brick and mortar shop remains a huge challenge. According to a Mckinsey report, “customers’ desire to get their goods delivered same day when ordered online tends to increase the value of online purchases but also creates an opportunity for the eCommerce and logistics market”.
Traditional eCommerce today is built around warehousing. When a customer shops online, the order is fulfilled from a warehouse or fulfilment hub closest to delivery, where the order is packaged and sent through a delivery van to the customer. Where the products are not readily available in the warehouse, the merchant or vendor selling on the eCommerce is required to bring the package first to the warehouse operated by the market place.
Certainly, such a structure that requires a vendor to first deliver a package to a warehouse where packages are then aggregated before being shipped to customers, cannot be said to be efficient.
This model needs to change if customers must get their packages delivered same day within the city. Using the Dellyman platform integrated with eCommerce, orders placed by customers trigger a pickup from vendor directly to the customer. The Dellyman platform immediately locates logistics providers closest to vendor location to reduce pickup time. Needless to say, the pooled assets on the platform ensures we find service providers at all times so that same day delivery is guaranteed
Ecommerce and marketplace companies need to be bold and confident to offer same day delivery where customer orders are shipped from vendors directly to the customers. And those are the ones that will win the eCommerce market tomorrow. Dellyman makes this new way of delivering customer orders possible.
While it may be true that logistics alone cannot solve all the problems of eCommerce, addressing the problems with delayed or failed delivery goes a long way to deliver on the same-day delivery promise and by extension the success of eCommerce.
Dare Ojo-Bello is the founder/CEO of Dellyman Logistics, Nigeria’s pioneer marketplace for logistics companies. You can reach Dare on +234 806 003 1112 or via email at [email protected]
Key learnings from the Fintech Rising webinar with SEC
The main benefit of being regulated has to do with investor confidence, security, and scale.
Last week, Nairametrics hosted a webinar tagged “Fintech Rising: Creating synergy between fintech players and regulators” to discuss the regulatory environment within which the wealth-tech ecosystem operates and how it is transforming the sector.
The recent announcement by the SEC about its first license for Fintechs – Digital Sub-broker license – has led to several questions being asked about what this type of registration would mean for players within the space. Tosin Osibodu of Chaka, a digital trading platform for local and foreign stocks, who was present on the panel, provided insights into what being regulated by SEC means, and the benefits to the sector.
- Being regulated does not limit your business:
He highlighted that from the start, Chaka has been extremely focused on being regulator friendly, explaining that being regulated does not mean that one’s business would be limited. Regulators are committed to ensuring development and innovation within the ecosystem but will first make sure that businesses are aligned with their goals and are beneficial to the public.
- SEC’s intention for creating this new license:
The regulators’ intention is to make sure that everyone participating is registered and structured in line with set guidelines, and it is incumbent for players to engage SEC to do that. The right approach to take is to engage regulators, show the benefits of your business to the economy as being an enabler of digital investing, making sure it is easier for people to tap into the markets, and so on; then get requisite registration.
- The importance of regulation:
Tosin further highlighted that the main benefit of being regulated has to do with investor confidence, security, and scale. When a wealth-tech company just starts out, it is exciting both for the operators and the customers, but as it grows, it is necessary to scale, and that would require business and regulatory compliance according to set guidelines that obtain within the sector. Customers would want to know that in the long-term their money is safe, which the SEC is trying to ensure. The disadvantage of not having regulation in this sector is the uncertainty for the investing public, which the SEC is guarding against.
With this new license, which Chaka is in line to receive, the SEC is ensuring that only compliant platforms would be allowed to operate so that investors will be more confident knowing that their assets are safe and stable. It would further encourage more people to invest, and encourage more players to enter the market, therefore spurring innovation.
SalesRuby to gather over 300 revenue leaders from Nigeria, Kenya, South Africa, Ghana at the Africa Revenue Summit (AFRES2021)
The event which holds at The Campbell Centre, Marina, Lagos will feature 25+ Speakers, 25+ Sessions across several distinct tracks.
The Africa Revenue Summit formerly known as Sales Leadership Conference (SLC) has evolved over the past four years as the largest convergence for revenue leaders across corporate Africa. The first, second and third editions hosted by SalesRuby held in Lagos, Nigeria in 2018, 2019 and 2020 respectively welcoming over 400 participants each year.
This year’s edition intends to gather over 500 participants from across Africa including Kenya, Ghana, Nigeria and South Africa to discuss modern strategies, processes and techniques for driving the growth of companies and organizations. This year’s event; up from just focusing on sales; would be taking a deep-dive review of themes across the entire revenue value chain which would include sales, marketing, culture, people leadership etc.
The event which holds on Friday & Saturday, June 4th & 5th, 2021 at The Campbell Centre, Marina, Lagos will feature 25+ Speakers, 25+ Sessions across several distinct tracks. The theme of the summit is “Scaling Growth, Optimizing Margins”
Some of the speakers at AFRES 2021 include:
- Motayo Latunji – Sales Director, Hayat Kimya
- Bunmi Jembola – CEO, SaleRuby
- Olutayo Latunji – Head of Sales Operation, Nestle Nigeria
- Winston Nolan – CEO, Sales Machine (South Africa)
- Sam Kariuki – Sales Trainer, Growth Partners (Kenya, East Africa)
- Mawuli Ocloo – Chief Sales Partner, Salesmark Services (Ghana)
- Yewande Akomolafe-Kalu – Head, Branding & Storytelling, Flutterwave
- Ose Osundeko – Group Head, Digital Marketing, Fidelity Bank
- Kenechi Eneh – Divisional CEO, ipNX
- Adenike Lucas – VP, Sales & General Manager – West Africa, Upstream
- Fikayo Akeredolu – Head of Growth, Stears
- Ibiyinka Dada – Digital Marketing Manager, Airtel
- and 13+ more industry leaders
What to expect at the Africa Revenue Summit:
The speakers and leaders, which were selected from across four countries in Africa and across multiple fields related to the theme, will offer invaluable insights and actionable strategies to CEOs, Executive Directors, Head of Sales, Marketing Directors and associated stakeholders on such topics as:
- Designing a modern sales process for growth
- How to shorten deal cycles
- Telling brand stories that cut through the noise
- Strategic interventions for growing key accounts
- Culture as a force for growth
- Best class content strategies for today’s buyers
- Understanding the core principles and practice of sales enablement
- Designing a winning inside sales strategy
- Go to market strategies fit for these times
- Leading a product-led growth strategy
- Recruiting, onboarding & retaining exceptional sales talents
- and many more sessions
Interested in participating in this event, visit https://afres.africa/get-ticket/
Call 09070047684, 09070048214. You can also send an email to [email protected]
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Nairametrics | Company Earnings
Access our Live Feed portal for the latest company earnings as they drop.
- Seplat Petroleum Development Company postpones Q1 2021 dividend payment date.
- FMDQ approves quotation of MTN’s Commercial Paper worth N73.5 billion.
- MTN Nigeria issues a 7-Year Series 1 bond worth N110 billion.
- Caverton Offshore Support Group reports profit after tax of N520 million in Q1 2021.
- Okomu Oil proposes dividend worth N6.7 billion for shareholders.