‘Our truck-trailer market place will cut 1 lakh empty trips a month at JNPT’
How would your new platform help improve the first and last mile movement of containers to and from the ports?
India trades 18 million twenty-foot equivalent units or TEUs annually. This means, a first mile delivery of six million TEUs at ports and three million TEUs at inland container depots (ICDs). This translates into about 10 million TEUs one side empty trips with an average distance of 50 kms a trip.
For a last mile delivery to a customer under Direct Port Delivery (DPD) – direct or through container freight stations (CFSs) – we are looking at about eight million TEUs travelling an average of 350 kilometres (kms) each, empty. This is a significant loss to the entire supply chain and even impacts the viability of the country as an export destination.
Our technology platform focuses on optimizing these. We help in utilizing trucks carrying export containers to the ports to deliver first mile import containers to nearby CFS locations on the way out instead of travelling empty. This results in increased efficiencies and reducing first and last mile movements by about 50 per cent. Similarly, our technology gives real time visibility to the shipping lines and helps match e-delivery orders. We believe that the $20 billion spent in containerized supply chain can be drastically reduced in India by deploying our platform and when we look at a global scenario, the addressable spend on empty movements is estimated at $300 billion.
What will be your pilot project in JNPT?
The intention is to reduce the number of empty trips and de-congest the infrastructure for the first mile. We are also working on creating a cargo network for the last mile which will add to the throughput.
We intend to do this by enrolling the local transporters and CFS on to our platform and providing real time visibility, automated vehicle booking, gate appointment and trip optimization. The reduction of empty trips will be directly proportional to the number of vehicles and CFS we will be able to onboard. The terminals are also a very important stake holder in this. We hope to reduce about 1,00,000 empty trips a month at JNPT within six months of roll-out.
How does your platform work?
The platform has a three-stage process:
In the first stage, we bring all stakeholders online so that everybody has real time visibility (after in-depth KYC).
Second, the integrated booking system and scheduling system are fully automated. Allocation of containers to trailers is done basis parameters along with enabling track/trace, digital contracts and documentation.
Last, the key is to be able to predict what would be the next utilization for trailer and container which our artificial intelligence (AI) driven engine rightly predicts.
What are the kind of cost savings accruing from the deployment of such a platform?
For triangulating containers from export hubs in Maharashtra, Punjab, Haryana, and Tamil Nadu to the nearest port, we can save atleast $250 per trip – which is higher than the ocean freight in some cases.
For first mile per trip, direct savings for CFSs can range from ₹100 to ₹300 and each empty trip saved has a direct impact on the carbon footprint and reduces fuel consumption.
For dry ports, the visibility on re-use of a trailer or a container or a common pool of trucks can save anywhere between ₹1,000 to ₹1,500 per trip.
Aurangabad and Silvassa are great examples – a typical one side empty import or export cycle is ₹35,000 and ₹22,000 respectively. If you are able to match containers for re-use using a digital and intelligent platform, the trailer is utilised, the throughput for port increases, earning potential for shipping lines improve and the exporter can save anywhere between ₹4,000 to ₹8,000. Now, imagine this in the context of cotton, soya, or any seasonal commodities; as a nation our parity is lost and we are unable to export the goods due to cost viability in the global market.
How do you onboard local transporters who feel threatened by the induction of your platform?
We work closely with local or any transport partner we onboard; they key is utilisation of asset which we drive – if the asset is utilised and more trips are loaded, the revenue per trailer increases for the partner. We also believe in transparency. The availability of fleet and rates are available online on our platform.
How do you address liability issues?
Each transport partner on-boarded on the platform is validated to meet all compliances and standard operating norms. We, as a platform, offer trip level transit insurance for the container which is mandatory for any travel above 150 kms. The other liabilities are passed directly through the smart contracting module to the engaged transport partner online.
Are you working with other Indian ports to de-bottleneck their container evacuation problems? If so, what has been the outcome?
We started our operations at the Mundra port. We have implemented an internal port traffic optimizer there. This has resulted in the reduction of about 3,000 empty trips a month for the inter-terminal and yard transfers.
We have also worked extensively creating cargo clusters around Hazira port as well as on matching liner trade routes by modelling a stable freight index with a two-way utilization model.