The 21st century is going through a historic phase of massive disruption through the use of technology. The tech savvy generation has taken the game to a level beyond imagination in nearly every sector.
“Then why would the massive $300 billion Indian transportation industry live in stone age?”
Hence, the inception of new age technology driven truck aggregators! Typically, a small sized “baniya” fleet operator can easily earn 500%-600% return on his investment within 3-4 years. However, the trucking business largely follows the law of diminishing returns.
There could be several reasons to this, but primarily it is due to increased vehicle idling and lower utilization. Inefficiencies kick in leading to freight charges being much higher compared to global benchmarks.
(left-right: Raghav Himatsingka, and Keshav Himatsingka)
It is this very opportunity that the Himatsingka brothers seized through the Truckola – a brand which made news with a INR 4cr angel fund. The Himatsingka’s have been in the transportation business since 1885 with unmatched years of firsthand experience in long haul and heavy cargo transportation. It was thus a natural choice for them to work towards transforming the industry.
Today, fleet owners are not hesitant to join their platform, simply because they have an extremely strong value proposition -Truckola not only increase their business but also process their invoices promptly, and with the use of technology they effectively manage the fleet, and proper route planning reduces their vehicle idling considerably.
So what is the edge they offer over competitors like Rivigo and Blackbuck?
The Truckola team doesn’t consider the new age technology driven transportation companies as their main competitors as of today. In an industry that is about $300bn (by some estimates); the largest players have a top line of a few hundred million. This shows the fragmentation in the market. Hence, traditional transporters are still their main competitors. Speaking specifically on Rivigo & Blackbuck, Keshav Himatsingka, co-founder and COO of Truckola said, “Well, Rivigo’s model is different in that they own vehicles and are trying ways to effectively manage and scale fleet operations. Blackbuck on the other hand has a similar asset-free model as ours, but we believe we have stronger value propositions, more robust long term vision, faster tech adoption, better execution capabilities and we have the numbers to prove it.”
How has Demonetization affected the heavily cash dependent truck industry, and, in turn Truckola?
Traditionally, transportation has been a very cash intensive industry. The drivers have always required cash for fuel, toll taxes and other en-route expenses. From the beginning the team had realized this to be a major obstacle in scaling up. Demonetisation was actually a blessing in disguise; it accelerated the use of fuel cards, RFID toll cards, and cashless transactions. This has made the operations much smoother and easier to automate. “There was a short term dip in demand, but demonetisation pushed the fleet owners into adopting technology and new payment options which will help us immensely in the long run,” said Keshav Himatsingka, co-founder & COO.
Demonetisation was actually a blessing in disguise; it accelerated the use of fuel cards, RFID toll cards, and cashless transactions. This has made the operations much smoother and easier to automate.
The journey of Truckola
Truckola started with one location and 3 people, and today the team is working out of over 25 locations around the country with a large team. The team has a presence in almost every state in the country. Operationally, they now have a strong network which helps it increase efficiency of vehicles plying under them. “We have a strong tech team which develops our proprietary technology which is used by all our clients and about 90% of our vendors (fleet owners)” says Keshav.
“Last 1.5 years, we have focused on servicing our clients as a transporter. This will be our main focus as we grow as well. We are currently growing at 30+% MoM, and this rate will only increase going forward. We have a large list of clients in the pipeline and potential new locations to start work at. However, our plans also include a platform to service every stakeholder in the ecosystem. We plan to start rolling out some of the services this month and continue to add new services for the next 3-4 months.”
Truckola is looking to start the process for a Series A funding soon. The brand is well placed in their journey, where they feel another round of funding would help Truckola seize a large part of the market, propel themselves as the leaders and move past the largest traditional transporters of the country.
-by Justapost team