The movers and packers industry in India sees around 35,000-40,000 movements every day, but it still remains a very unorganised sector for the business-to-consumer (B2C) segment.
Spotting an opportunity in the sector, Avinash Raghav started Shift Freight in 2020. The Noida-headquartered logistics startup is an online marketplace that aggregates vendors and connects these movers and packers with consumers to provide on-demand shifting services. The company claims its business has turned cash positive within a year of its launch.
Shift Freight is now operational in Delhi-NCR, Bengaluru, Chennai, Hyderabad, Mumbai, Pune, and Kolkata, providing both inter-city and intra-city services.
Avinash says he started Shift Freight as he was unhappy with the kind of service he once received by movers and packers, and felt there was much to be done.
“There is a huge gap between what the consumers are expecting and what they are getting. If we can fill this gap, the response would be phenomenal,” says Avinash.
The beginning was not very easy for Shift Freight as it launched its operations around the time the government announced a nationwide lockdown to combat the coronavirus.
It was literally a ‘trial by fire’ situation for the startup as it had planned numerous things for the packaging and logistics industry, but it was also a wake-up call for Shift Freight. The startup then decided to focus on the B2C segment as a marketplace model.
Once the lockdown restrictions were eased, Shift Freight began its actual operations in June 2020, where it promised its consumers standard quality services at reasonable rates.
Leveraging the various digital tools and through word of mouth, Shift Freight managed to garner good customer traction within a short span of time. However, getting the vendors to deliver good quality service was a challenge.
Avinash says, “We are an aggregator with hundreds of vendors working with us. We also segregate them into super and generic vendor.”
All the vendors who come on-board Shift Freight will have to follow the conditions laid out by the startup, and failing to meet these standards will mean a direct loss in business.
According to Avinash, many of the packers and movers are keen to work with the startup as it assures steady business volume. Besides, there are also other incentives that Shift Freight provides to vendors which include soft loans, cashbacks on achievement of certain performance benchmarks, and this includes providing uniform clothing.
During the pandemic, to gain the trust of its consumers, Shift Freight ensured that all the workers engaged in packing were given PPE suits. Now, from the month of March, the startup will start providing packaging materials as well.
“People have emotional attachment to their belongings and we need to ensure that the packaging material is good,” says Avinash.
Focusing on consumers
From a consumer point of the view, apart from the price quotes, the startup assigns a dedicated coordinator in the beginning to monitor the entire process – from the time of the packaging till it reaches the destination.
Avinash says, “Our model is not based on low-cost price, but we are competitively priced. Consumers will never object to a price if you provide the deserved service.”
He further says the vendors are his partners and the startup generates revenue through the service charges provided to the customers.
“Vendors have to just focus on delivery and we take care of all their other requirements like filling up invoices, customer bills, etc.,” says Avinash.
The business and future plans
From doing 50-100 moves per month in February 2020, Shift Freight has now crossed 1,800 moves. During the coronavirus lockdown, its business had come down to zero, but since June last year, it has been growing at 60-70 percent month-on-month.
“In two months’ time, we will be touching about 100 moves per day,” says Avinash.
Shift Freight currently generates a revenue of Rs 2 crore per month and aims to touch Rs 4-5 crore monthly very soon.
The bootstrapped startup has received an angel funding of $1 million. “We are a cash positive business now and may look at a strategic investor in the near future,” says Avinash.
Given that Shift Freight is focused on the B2C segment, its ticket size orders starts from as low as Rs 1,000 going all the way up to Rs 2 lakh.
The startup has a team of around 40 people dedicated to technology development. It says the the team comes up with innovative solutions to make the entire process of packing and moving of goods as smooth as possible. These include providing solutions like automatic calculators to consumers where they estimate the price to be paid for the services within no time. Also, Shift Freight’s technology platform allows them to start their services in new cities without much hinderance as it is an asset light model and all it needs is to find the right vendors to provide the service.
The startup, which competes with HappyLocate and Shiftkardo, plans to expand to more than 40 cities by the end of the current financial year. It also plans to get into the US market.
However, one big challenge for Shift Freight is maintaining the quality standards from the vendors in terms of hygiene, behaviour, and the usage of packaging materials. The startup claims to be constantly providing this training.
“Our biggest USP is the quality of service and we spend a lot of time on R&D to understand the needs of this market. Consumers come to us for booking and not for negotiating,” says Avinash.