Need India Post to replicate RuPay moments
India Post has fault lines. It needs to be repaired. — Alok Singh
The India Post has fault lines. It needs to be repaired. Despite having a huge network of offices, human resources, and warehouse facilities at prime as well as remote locations, they are losing consistently and have lost enough. It’s time to adopt the strategy of the day for India Post. The coming together of India Post and Indian Railways for parcel delivery is inadequate to substitute the foreigners like Amazon and Flipkart.
The aggressive strategies of Amazon and Flipkart have threatened and encroached on the turf of India Post. The admission of this reality is the first step to come back again. These companies deliver many items to customers today. In fact, these companies have become so giant that they control the customer, the manufacturer, the supplier, and have created paths to sell at the cheapest price, it’s unbelievable that they sell the product cheaper than the price at the factory gate of the manufacturer. Also, they don’t pay appropriate taxes to the government.
Initially both the companies started as a company that does the business of book delivery at home. They can be labeled as e-commerce or e-retailer or e-marketplace or e-logistics or e-information companies. The tax collectors are still struggling to figure out who they are. The policymakers still have to come up with a robust e-commerce policy which is today a delayed work in progress; a policy that can be interpreted equally by the customer, the regulator, the company, the tax collector, and the members of the inbound and outbound supply chain. In the early phase of growth, these companies offered a platform for the publisher and the customer to come together and might be some courier companies partnered with them, then no one complained. But they created a key point for themselves i.e. point of money payment or the collection and later point of control.
A customer willing to buy a book usually orders a book to a publisher pays to the publisher, and the publisher would do the Book Post using the services of the India Post. But these new-age companies worked as if the customer is buying books from Amazon or Flipkart. The change is here. Today the customer is buying from Amazon or Flipkart i.e. buying directly from the company which acts as a courier company, and not as a publisher. In the earlier system the book publisher came first and Courier Company later but today the courier company comes first and the publisher later. The coupling and decoupling of the publisher and the courier company over a period i.e. decades of the timeline are important to understand the controller of the business.
We understood the necessity of better banking transactions and developed our own United Payments Interface (UPI) which seized the market at a time when Google Pay and Paytm had already established themselves in the digital payments ecosystem, and both peer players are technology companies i.e. surprisingly non-bankers.
An analogy can be drawn that Amazon and Flipkart are not core courier companies but acts as home delivery company which has brutally killed the business of the Book Post of India Post. Daryaganj in Delhi is the best place to witness the killing of the Book Post business of India Post.
Daryaganj in Delhi is the hub of book publishers and booksellers. Any publishers who do good business have a presence at Daryaganj. They have offices spread at different locations but Daryaganj is the name for book publishers. If we visit any book publishers in Daryaganj we see that the people from Flipkart and or Amazon have a presence in the space of the publisher’s office. India post is missing the business model.
The one and only strategy are to understand the rules of the new game and adopt the changes in the organization. The homegrown RuPay system has caused nightmares for foreign-grown peers. India Post can replicate the success story.
Today’s customers are demanding services and products from a courier company or a company that behaves like a courier company. Earlier the customer and the manufacturer were core drivers of the business. The colony retailers could take demand from the end-user consumer and pass the information to the manufacturer. The world is moving towards a single retailer shop, it needs to be stopped. The new business model is to be followed.
India post is the hope for the regulators to control the tax theft by foreign located data companies. Daryaganj will be a good place for India Post to start the business. India post receives a book parcel from the publisher and then it transports to the destination- this is the traditional way. The India post will have to change the process. Its book parcel division can’t work the old way. The India Post has to reverse the supply chain process. It has to develop a webpage and create awareness that it also takes orders on behalf of the publisher from the customer. India Post has to reposition its business practices, it has to emerge as an online retailer rather than just a parcel delivery company.
India Post can do the same to Amazon and Flipkart as RuPay had done to Amex, Visa, and MasterCard. India Post should transform itself and start as an online bookseller company. This is the first step to compete with Amazon and Flipkart. Later on, India Post can move along the path to provide an indigenous alternative to Amazon and Flipkart to domestic customers. The data privacy and the decentralization of data-related policies will favor India Post, as these new-age technologies will be forced to invest in data localization. The other example is the success of Mumbai Dabbawalas as a tiffin or logistics supplier which has earned awards worldwide. It’s the right time to launch ‘Online India Post Book Shop’. Right intent from policymakers is needed in the globalized world.
(Alok Singh is a Fellow of the Indian Institute of Management Indore and currently is faculty of general management at NICMAR, Delhi-NCR Campus.)