Online courier business rebounds on Eid optimism

A spike in orders during the ongoing Eid shopping season has brought back a bright smile to online courier service providers, a development that is a sigh of relief for the industry that witnessed a downturn in growth over the past one and a half years. 

Online shoppers have been showing enthusiasm since the beginning of this month and logistics companies have witnessed an over 80 per cent increase in orders compared to other times of the year, according to industry people.

The impressive performance of small merchants, mainly women, and customers from social media, mainly Facebook, have paved the way for the increase in demand.

Besides, e-commerce and online platforms of different brands are also contributing to the surge in online deliveries.

Most Facebook-based merchants and e-commerce entities and brands have no delivery mechanisms of their own. They outsource the courier service using apps or websites. Besides, anyone can secure home deliveries by accepting orders online.

Since massive scams involving e-commerce unfolded in mid-2021, the growth of online logistic service providers had stalled. But industry people expect their market to bounce back riding on the growth this Eid.

Online shoppers have been showing enthusiasm since the beginning of this month and logistics companies have witnessed an over 80 per cent increase in orders

"Demand has picked up in the last couple of days, the number has almost doubled," Fahim Ahmed, chief executive officer of Pathao, told The Daily Star.

Pathao Courier, which serves over 50,000 small merchants, are now making over 1 lakh deliveries per day, up from 60,000 deliveries per day a month earlier.

"Interesting trend is that delivery volume growth is bigger outside Dhaka," he said.

"In the last one and a half years, we have ramped up our expansion and expanded the footprint to upazila levels, set up sorting facilities at every division and increased the number of distribution hubs to 150, enabling us to cater to this growing demand," said Ahmed.

"The demand for logistic service for online deliveries has been great since the beginning of this month," said Biplob Ghosh Rahul, founder and CEO at eCourier Ltd, an on-demand last-mile logistic network offering tech-enabled one-stop delivery solutions.

"There were some trust issues over e-commerce that hampered our business, especially outside Dhaka. But we will overcome this growth," he added.

Last week, eCourier made over 25,000 deliveries per day, an over 80 per cent increase compared to other times.

According to Rahul, the top item that the online logistic service company was catering to during this season was clothing.

"However, the online order for gadget items and beauty, personal care and hygiene products are on the rise in recent times, especially for the Eid season," he added.

Industry people said over 95 per cent of payments for online deliveries were now made through cash-on-delivery methods since related fraudulence unfolded in the sector, having a significant impact on the government's cashless and digital ambitions.

Rahath Ahmed, co-founder and chief marketing officer, Paperfly, said it now delivers about 25,000 orders, up 30 per cent from other times.

Most of the online orders it caters to are from e-commerce companies such as Daraz, and Shajgoj. It also makes Unilever's online deliveries.

"We could not imagine that the demand for online logistic services would rise that much. It's great that people outside Dhaka resumed online shopping," he added.

"It is because logistic companies have scaled up their operations, shortened the delivery time and are providing quality service," he added.

Fahim Mashroor, CEO of Delivery Tiger, a logistic service provider of Facebook-based small and medium enterprises, said the number of deliveries has increased by up to 60 per cent over the past two to three weeks.

"We have increased our manpower to enable seamless delivery during the shopping season," he said.

"As the prime product of Eid is clothing, there are frequent issues of exchanges. To encourage shopping, we are giving free exchange service for our clients," he said.

Delivery Tiger will charge Tk 35 and Tk 85 for a delivery in and outside Dhaka respectively.

Even conventional courier services have started to cater to online merchants' deliveries.

Hafizur Rahman, vice chairman at Sundarban Courier Service, said they are now delivering about 7,000 orders placed on Facebook pages of small merchants, up from 5,500 a month earlier.

According to top officials of online courier service platforms, the number of product deliveries of orders placed online have now reached 3.5 lakh, up from 1.8 lakh in other times.

About 15,000 workers are engaged in making the door-to-door deliveries and their average minimum income is about Tk 15,000.