In Brief: Shunya One Ep. 7

On Episode 7 of Shunya One, Mayur Aggarwal, a tech entrepreneur and founder of ShipEasy, joined Shiladitya Mukhopadhyaya and Amit Doshi to discuss logistics.

While discussing bootstrapping and all the pitfalls and penalties one encounters while initially setting up a business, Shiladitya comments on the need for entrepreneurs to be aware of the basic aspects (accounts, HR, etc.) of their business - 

[Entrepreneurs] should know “what will mess with me”, “what will screw up my business and my life” vs “what’s my safe playing ground”. I think that clarity we don’t have, or (because it’s so complicated) we don’t bother. That’s when people start saying, “Let me just find a trusted advisor who’ll say ‘don’t worry about a thing’, and I’ll not even look at the intricacies of it’ and [then] choose to focus on whatever I like to focus on. And that piles up, as an entrepreneur.....and that’s a bad attitude....the fact that most people don’t want to go deep because the deep is so deep

Over the course of their discussion they briefly comment on the workings and importance of Chartered Accountants in India, the Ken article “Why a lack of judicial reforms could kill India’s startup story” and Uber, and then get down to brass tacks of logistics. Mayur illuminates the political influence on logistics in India - 

A lot of unskilled labour generally tends to move into logistics. So, as population has grown, a lot more people have been accommodated into logistics and warehousing. now if you traditionally look at warehousing or logistics they are usually [run by] people who are politically connected, people who are either patrons of political parties or themselves in that whole spectrum. One of the biggest things they can get access to is cheap labour. Cheap unskilled labour. So that builds the building block of that multi-level broker facet. The more people I have in the value stream, I too get ignored for my big margins. [if] there’s somebody else across the state at your end, who’s also running a very bad show but you’re paying him 6%, why not pay me 6% as well. Probably both of them could be eliminated by one guy whose running it at a more efficient manner at 3% but then that’s how the political connection comes in.

Continuing on logistics, they discuss the implications the new GST bill will have on it. Amit comments on the need for overhaul in logistics in India - 

Logistics is the single biggest area where india can improve its efficiency and productivity by so much, it’s not even funny. Right now the amount of time it takes for goods to get from a factory to a distributor is insane! It is insane, when I hear these numbers! And somebody [tells me], “we just sent our shipment out because we’re going to run out of stock in 20 days and we need to make sure it gets there on time.” I’m like 20 days! 20 days is 2%! If you’re running a manufacturing business, 20 days is 2%. that means that basically in a year your looking at 25% productivity that can happen by being able to cut that number.

Catch the full episode here: