In yet another series of business failures, on demand logistics provider, Parcelled, has decided to stop self-delivering parcels earlier this month owing to high cost of logistics. It has decided to outsource its delivery services to third-party vendors. Its main focus now is on technology i.e., the mobile application and will act as a booking agent for parcels. As a part of the pivot, Parcelled had stopped the last of its logistics services earlier this month and reduced its delivery fleet to naught. The company spokesperson refused to comment on how many employees had been laid off in this process. In this line of business, the pick-up and deliver staffs comprise the majority of the employees.
The Company had been trying to raise funds since January 2016, through investments to sustain its operations. However, it was forced to outsource delivery services after it failed to do so. The cost of delivering parcels on its own became too high at the unit level due to the high cost of fuel and thereby the business became unsustainable, forcing the company to outsource the delivery business.
Parcelled was founded in January 2014 by Xitij Kothi, Abhishek Srivastava, Nikhil Bansal, Prateek Bhandari and Rikin Kachhia and had an employee strength of 150 employees when it started. It offers its services in Delhi, Bangalore, Mumbai, Pune, Jaipur, Chennai, Kolkata, Hyderabad, Surat, Indore, Gurgaon, Noida and Ahmedabad. Parcelled, which is based in Bangalore, provided courier services by allowing users to schedule a pick-up within 30 minutes for delivery to any part of the world. The company also did packaging and paperwork. Parcelled is run by NAXR Logistics Pvt. Ltd, the company had secured an undisclosed amount of funding from the logistics firm, Delhivery and the data analytics firm Tracxn Labs in July 2015. Four months later, the company had raised $5 million (about Rs. 32 crore) sponsored by the logistics services company Delhivery with Tracxn as the co-sponsorer. Other companies in on-demand courier service include Sendd, ShipEasy and Pigen.
In December 2014, e-commerce based logistics services provider, Delivree King had closed operations as it was unable to raise fresh funding to run operations. In October 2014, the delivery startup, Chhotu.in, which was backed by Paytm’s Vijay Shekhar Sharma, closed operations due to high cost of logistics.
The government of India must take the successive failures of startup companies in India very seriously. Many startups have been shut down and consequently many jobs have been lost due to insufficient capital, poor availability of funds through loans or investments and due to high operational costs. The Indian PM, Mr. Narendra Modi must deliver on his promise in the Stand up India Start up India scheme and make the equivalent of U.S. $1.5 billion available as loans to startup companies, waive taxes for three years and strengthen startup ecosystems so that knowledge (know how’s), ideas, skilled laborers and money or capital can flow easily within the eco-system and benefit both startups and corporate alike.