E-commerce platform Meesho on Wednesday formally launched Valmo (portmanteau of ‘Value’ and ‘Movement’), a tech-driven initiative, through which it seeks to integrate India’s fragmented logistics entrepreneur network. The Softbank-backed firm looks to count on the untapped capacity of local delivery and logistic solutions to bring down its overall shipment costs.
The technology stack, which the company has built by partnering with players such as ElasticRun, FarEye, Loadshare, and Shipsy, has helped Meesho save around 5% of its overhead costs. The company expects Valmo to help cut logistic costs by another 5 to 7 per cent in the next few months.
"Valmo is our bold step towards democratising logistics in India, representing our unwavering commitment to providing the best supply chain service while optimising operational processes,” Sourabh Pandey, CXO, Fulfilment and Experience at Meesho, said in a press release.
With this tech-enabled initiative, the e-commerce unicorn is looking to double down on the vast network of unorganised players in India’s logistics sector, which grew rapidly after Covid-19 pandemic drove digitisation and e-commerce adoption across the country.
The logistics sector already contributes approximately 14% to India’s GDP and is expected to grow at a CAGR of 8.83% to reach $484 billion by 2029, from $317 billion in 2024, as per a forecast by Mordor Intelligence, a market research company.
Meesho first started the initiative as an experiment in mid-2022 to leverage the extensive knowledge micro-delivery partners have about consumption patterns in their local geographies. Ever since then, the company has partnered with 3,000 local logistic entrepreneurs across 6,000 pin codes in 20+ states.
It looks to onboard as many as 100,000 such local entrepreneurs on the Valmo platform within the next three years, Pandey said. The company is looking to create an efficient, cost-effective logistics ecosystem that empowers local players and contributes to job creation, he added.
Since its trial in 2022, the company has been able to service an average of nine lakh shipments per day and generate indirect employment for 35,000 people.