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Flipkart arm Ekart joined with Apollo Pharmacy

Update On :19 March 2016

Flipkart arm Ekart joined with Apollo Pharmacy

Ekart, the logistics unit of Flipkart, is rolling out two new initiatives aimed at improving efficiency and capacity utilisation. It has tied up with Apollo Pharmacy for delivery and pickup of products like smartphones and apparel ordered by customers.

The unit is also launching a Fulfilled by Ekart (FBE) initiative to tap merchants selling goods on other etailers, which will be a big area of growth in future, according to a top executive.Over the last three months, Ekart has tied up with over 300 Apollo Pharmacy outlets, delivery personnel can now drop-off shipments at these locations, offering customers the option to pick it up at a convenient time. Ekart plans to expand this initiative to a 1,000 stores. While this offers more options to customers, it will also help Flipkart solve the problem of failed deliveries. "About 15% of pan-India deliveries at any point of time are not going through because customers are not available," said Neeraj Aggarwal, senior director, last-mile operations at Ekart.

At the time of ordering, customers can choose the pick-up point, the product will be delivered to the store after which the customer is alerted with a four digit pin number to pick up the product. The shipment is kept at Apollo Pharmacy for five days, after which it is returned. Ekart will pay Apollo an undisclosed amount for keeping these shipments. "In the medium run, we will look to do a significant portion of our shipments from this channel," said Aggarwal.

Experts said that such moves can help save significant costs. "Rather than attempting three deliveries, which increases costs by 25-30%, you can just drop the product at these centres. In China this has happened in a big way where grocery stores have become last-mile delivery and pick up points," said Manish Saigal, MD at consulting firm Alvarez & Marsal.

FBE is part of a big bet aimed at making Ekart an independent logistics company, which ET first reported on February 1. The idea is to offer warehousing services and end-to-end fulfillment services to sellers using Ekart.

"FBE will offer the same kind of service levels (as Fulfillment by Flipkart) for other ecommerce companies. That will be a critical model for us going forward," said Aggarwal.Ekart expanded total warehouse space to 1.6-million sq ft at the end of 2015 across 17 fulfillment centres (FCs), with plans to open 6-8 more FCs in 2016. Its delivery staff expanded by 40-45% in 2015 and currently stands at 14,500.

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