Delhivery’s prevalent strategies in its pricing models
|Pillar||Business model building block||Description|
|Product||Value proposition||The company offers third-party logistics services. It offers an elaborate supply chain services in a very convenient and elaborate network system across 1,200 cities in India(Deepti, 2015).|
|Customer Interface||Target customer||Being a third-party logistics provider, Delhivery targets small and medium-sized businesses, large enterprises, and leading e-commerce platforms as well as individuals for logistics services.|
|Distribution channel||The company has a vast network distribution bounded on world-class infrastructure, high-quality logistics operations, and cutting edge technology and engineering capabilities. The company’s network encompassed 19 automated sort centers, 14,000 vehicles, thousands of delivery centers, and a team of 21,000 members. Delivery is estimated to deliver an average of one million packages a day during peak hours.|
|Relationship||The company creates personal assistance, automated service, and a long term relationship, with most of its customers. Here, both the producers and suppliers ensure a back to back relationship with Delhivery, where it assists them in distributing while at the same time bringing in what they require for production and daily operations. For an individual, the company ensures that all the individual customers’ desires are met at their most convenient location and time.|
|Infrastructure Management||Value configuration||What is more exciting about Delhivery is the optimization of its entire delivery system with the help of Elastic. Elastic stack enables the company to search, analyze, and visualize millions of data points collected from its delivery network daily. With these data at their display, they can be able to increase the efficiency and speed of delivery, thus ensuring flowed profits and customer satisfaction.|
|Core competency||Delhivery core competencies are efficiency and speed. They collect data from every delivery to assist in improving speed and efficiency. They have also introduced a way of tracking your order, which enables a person to make plans based on its movement. With improved efficiency and speed, customers will increase their loyalty to the company, which will spike growth.|
|Partner network||Its recent cooperation was with Dubai’s courier giant Aramex which was to buy Aramex India to increase its customer base. Delhivery is also seeking alliances with logistics players in the U.S, China, and the Middle East (Sandeep, 2019). Additionally, the company has been creating partnerships with major e-commerce and large corporations to offer them their services.|
|Financial Aspects||Cost structure||The cost will constitute the fixed and variable costs. Variable costs include; labor, cost of each delivery, method of customer acquisition, raw materials for distribution infrastructure, and costs of data collection. Fixes costs for the company include insurance, interest payments, and rental and lease payments.|
|Revenue model||Direct revenue for services
Leases of data and other company property
Amalgamations and franchising
Delhivery Business Model Canvas
Delhivery has two prevalent strategies in its pricing models. These are cost-plus pricing and competitive pricing. Although they consider other strategies for price modeling, these are their strongest strategies based on calculating the costs and estimating their revenue desires and looking up at what their competitors are charging and having their price decisions set from there(Elastic, 2020). One of the costs is maintenance, hiring, buying, and renting new warehouses for sorting and storage of their deliveries. The company has thousands of delivery centers which costs a lot. However, the company can motivate and incentivize warehousing entrepreneurs to share revenues and risks. Delhivery can offer them incentives in their deliveries and third party logistic services provided, offering them a distribution center in some of their houses and offering them combined promotional services for their products. Here, Delhivery can get warehouses at a lower cost, or offer its warehouses for pay from various entrepreneurs.
Delhivery can prioritize between introducing new products, introducing new products, reducing costs, and entering a new market through an examination of their SWOT, POCD, or Blue Ocean RRRC analysis. Here, they will get clear indications of their options and metrics to prevent incurring unnecessary costs or walking over precious opportunities. Critical analysis requires proper data collection and analysis in order to make informed decisions. I would use the blue ocean E/R/R/C to evaluate these options by Delhivery Company because it concentrates on identifying and learning about the noncustomers. Here, I have a chance at understanding g the desires and wants of the noncustomers and their prospects on the services offered by the company. The Blue Ocean tool quizzes the noncustomers on the prices, preferences, competitors, future prospects, and their view on the company, products, and services offered, and so on (Chesbrough, 2010). With the information, Delhivery can understand which services it is supposed to eliminate, reduce, raise, and create in order to enter the new market. The information will also inform the prices and introduction of new services in the market. From the tool, we get a clear image of what to offer, how, and how much.
Sandeep Soni (February 16, 2019). Dubai’s courier giant Aramex sells India unit to logistics startup Delhivery. Retrieved from: https://www.financialexpress.com/industry/sme/dubais-courier-giant-aramex-sells- india-unit-to-logistics-startup-delhivery/1489675/
Deepti Chaudhary, (Feb 11, 2015). Sahil Barua: Leading E-commerce logistics with Delhivery. Retrieved at: http://www.forbesindia.com/article/30-under-30/sahil- barua-leading-ecommerce-logistics-with-delhivery/39563/1
Elastic (2020). Delhivery: Powering Operational Excellence for Third-Party Logistics. Retrieved at: https://www.elastic.co/customers/delhivery
Chesbrough, H. (2010). Business model innovation: opportunities and barriers. Long range planning, 43(2-3), 354-363.
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