Vichare couriers are one of the leading parcel service providers .Vichare accounts for approx 32% of the market share of the domestic courier in India. It started its operations in 1991 with a premium service provider, service offered only international route. At that time domestic market was opening up and Indian post was lagging behind in terms of efficiency, though reach was good.
The Problems faced by Vichare to pursue its reach to length and breadth of the country were as follows:-
- To change image of Vichare brand as a affordable domestic Courier company.
- To tackle competition of Indian post on Bulk mails & corporate Business.
- To increase market shares in heavy parcels services.
Mr.K.Henry was newly promoted as head of Indian operations. He had experience of establishing new Vichare Business in countries like Brazil, Estonia, Prague, which similar in demographics like India. Mr.Henry’s approach to new region business was ,” KEEP IT Simple “.As he started his first day at office , he called in a meeting of his small team of 3 regional Heads.Henry after a length of discussions with them , he had to decide the new marketing strategy for regional expansion , keeping the above objectives in mind. Henry believed that “if we want to do domestic business we will have to think locally”. Henry for tacking the first problem adopted a franchisee business model and appointed 200 franchisee Pan India. The 200 locations acted as a evidence that Vichare is a next door reachable company. Henry kept the local billing at a 10% discount from the other private courier companies.
Henry also hired some local talent from domestic courier companies and fresh blood from reputed Business Schools .This ensured that the company had a right mix of Experience and innovation. Henry to take on the second issue, Henry offered corporate a huge discount on long term mailing contracts of 10 years and above. The impact of this arrangement was that Vichare increase its market share in bulk mailing & corporate business from 4% to 11% in just 6 months .
Heavy parcel services required a huge investment in terms of transporting vehicles and warehouses .Vichare was not in financial position to go in for such CAPEX. Henry was aware that Indian Railway had the vast network and storage facilities which could help o resolve his third issue.Vichare signed a MoU with Indian railways to transport bulk parcels & storage facilities. All this and that to at a very suitable long term pricing.
The Main aspect where Vichare score points was the use of technology, where its competitor were far behind. Vichare parcels were tagged with RFID tags , wherein its location could be traced anytime through vichare’s online portal .This technology was leased from a vendor and didn’t had a huge cash outflow.
Henry could achieve a growth of 30% in top line and its market share increased to 16% after a year.
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