Efficiency of Online delivery,
Case study of printer cartridges
Rohit Kumar Parmar Free lance [1]
IES (Retd)
Former Senior Economic Adviser
Ministry of Consumer Affairs, Food and Public Distribution
1. Introduction
1.1 Large sections of Indian consumers have migrated to making online purchases for a range of goods and services. This aspect of the Indian economy is touted/boasted as a success. Efficiency of online purchase is crucial for consumer convenience/costs, profitability of the online system and faster growth of the Indian economy. This discussion observes and identifies areas where efficiency in online purchases can be increased. It also includes suggestions on how to identify and improve efficiency.
1.2 Efficiency has several definitions/meanings/interpretations. From the several definitions/ meanings/interpretation of efficiency, the following common elements emerge
1.3 Efficiency is the ability to work
i. without wasting (or with lesser) resources,
ii. without making mistakes/rework,
iii. without wasting (or with lesser) time,
iv. without wasting (or with lesser) energy,
1.4 In the present case study, elements of absence/lesser efficiency are observed, first is the waste of resource (warehousing), second the wastage of time (avoidable delay in delivery) and finally less than efficient utilisation of working capital.
2. Case study of Delivery of a Printer Cartridge
2.1 The author like several other consumers, makes online purchases of inter-alia printer cartridges, which sometimes due to non-availability/mismatch, end up blocking work (output) and so are critical inputs. An online order for purchase of printer cartridge was placed on 10.07.2022 at 16.56 hrs, by the author. This order was placed after payment of the amount, through an online payment system. In case the payment is on Cash on Delivery (COD) basis, delay in delivery also results in delay in receipt of payment, and associated impact on working capital requirement and interest on borrowed capital/interest forgone, for the seller and/or the platform.
2.2 One reason for the spread of online purchase system, is its ability to provide real time information to users (buyers, sellers and other players), from/to different nodes (movement points). Platforms that do not offer real time information to users are less popular. [2]
2.3 The real time information `track your package’ for the purchase of the printer cartridge, showed that the carrier picked up the package from the origin point. The package arrived on 10.07.2022 at 20.38 hrs at a facility at Bagru (Rajasthan), which is 28.4 kms from Jaipur or a travel time of 50 minutes. [3]
2.4 The next item on `track your package’ was the next day 11.07.2022 at 03.09 hrs, when the package left the facility at Bagru. The time taken would have been for consolidating packages, loading and dispatching for the next destination (Gurugram). This was followed by arrival of the package at a facility at Gurugram at 10.34 hrs. So far the functioning has not shown any sign/evidence of inefficient functioning. The time taken from Bagru to Gurugram is 7 hrs and 25 minutes, a distance of 240 km.
2.5 The facility at Gurugram is 47.7 km from the delivery destination or a travel time of 1 hr 20 minutes. There would have been segregation of packages and dispatch to different destinations in the NCR/Delhi. The next item on the `track your package’ is package left the facility at Gurugram at 21.58 hrs. This delay of 11 hrs and 24 minutes, for segregation and dispatch activity is 75 per cent more than the time taken at the facility at Bagru, Rajasthan to consolidate, load and dispatch, which is 6 hrs and 31 minutes. This inefficiency in the segregation and dispatch activity, resulted in the following :
a. Delay in the product being delivered to the consumer, which could have been done on 11.07.2022,
b. Delay in the receipt of payment, in case of COD mode,
c. Blocking of warehousing space and related infrastructure and manpower, at Gurugram,
2.6 This inefficiency needs to be recognised and a solution found to reduce the holding of the package in the Gurugram warehouse for 11 hrs and 24 minutes, instead of a maximum of 6 hrs and 31 minutes.
2.7 The next item on the `track your package’ is package arrived at final delivery station 00.02 hrs (possibly a location in Delhi/ South East Delhi, close to the final delivery station) on 12.07.2022, followed by delivery at 10.51 hrs.
3. Suggestions
3.1 Avoiding a discussion, the following suggestions are made,
3.2 Can the total time taken from receipt at the facility in Bagru to final delivery of 38 hrs and 13 minutes be reduced?
3.3 What are the (time, cost, image, other) implications of this inefficiency?
3.4 Are there individual activities such as delay in a particular facility be reduced?
3.5 How are the delays (Activity-wise, product group-wise, or some other way) to be identified?
3.6 How is the time taken at each centre to be benchmarked (vis-à-vis international/domestic standards (in the company or in the industry)? Previous best practices on the same.
3.7 Does the present software offer a facility to throw up exception reports on such inefficiency? If not what are the modifications required?
[1] Author has in posts on his website (https://rohitkparmar.wixsite.com/site), twitter (https://twitter.com/rohitkparmar?s=09), facebook (https://www.facebook.com/rohit.parmar.5268750/), linkedin (https://www.linkedin.com/in/rohit-kumar-parmar-841b4724) been writing on varied topics and can be reached at rohitkparmar@yahoo.com. [2] Author on the absence of real time information from such a platform, chose not to place any further orders on the same. [3] Distance and travel time could vary due to several reasons such as route taken, traffic congestion, etc.
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