By Rahul Pillai
The year 2023 will and the next few years are going to see the Packers and Movers’ (P&M) industry in India grow significantly. The market in the country is expected to be worth US$ 1.56 billion by 2025. The P&M industry is expected to grow at a compound annual growth rate of 15.5% between 2018 and 2025. Largely, increased demand for personal and business relocation is the key growth driver for P&M services in India. Majorly of this growth will come on the back of widespread technology adoption across business functions by P&M players. For long, India’s P&M industry has operated sans technology relying upon physical labour with no or minimum intervention of technology or digital tools. However, all that is going to change in 2023 and beyond with greater adoption of digital technology and deployment of digital tools.
Technology adoption to drive productivity and promote transparency
India’s P&M industry is growing but it continues to operate in an unorganised manner. One of the biggest challenges the industry is facing at present is a lack of transparency. And this has mostly to do with the industry being saddled with legacy operating systems and IT infrastructure. Old ways of working and over-reliance on face-to-face interactions and paperwork is impacting service quality resulting in higher customer dissatisfaction, potential revenue and client loss for P&M players. The P&M industry is aware of these challenges and the industry is showing green shoots in technology investments to fast-track growth.
Going forward, big and mid-size P&M players are betting big on technology to modernise their businesses.
Key business imperatives for technology adoption
The higher demand for P&M services across the country is being driven by the growing need to move people and goods safely. Industry data shows that about 70% of people looking to relocate are keen on availing of professional P&M services.
Interestingly, a large number of P&M service seekers are young working professionals – a group that is digitally savvy and values a satisfactory paperless service experience.
It is this segment o consumers along with big corporate houses that are going to see P&M players accelerate their digital transformation journeys.
The big shift in technology adoption
Largely, the P&M industry continues to function traditionally with limited technology adoption. Yet, there is a slow but promising development where new-age start-ups are getting into the P&M industry and changing the industry landscape. With their technology-first approach, new players are redefining the P&M industry landscape.
Most of these players are currently offering P&M services in major cities. With their focus on technology and transparency, these young companies could in the next few years pose serious competition to big and established players, particularly those who are running legacy operations.
Technology: the biggest service differentiator
Over the next two to three years, technology is going to be the biggest differentiator in service delivery for P&M players. Increasingly, existing and new entrants in the P&M market are looking to deploy technology to streamline business processes (including packaging, warehouse management, and logistics), simplify and security-proof shipments and fleet movement, and reduce human error in managing the movement of goods, and increasing machinery and people productivity. The following key areas, functions, and processes are and will see accelerated technology investments by P&M players over the next few years.
RFID-powered packaging and transportation
Guarding against product piracy and theft, P&M players are investing in new-age packing powered by RFID (radio-frequency identity) codes. RFID codes are published both directly on the packaging field and integrated into it. A smartphone receives alerts from the RFID generation allowing automatic communique with the package allowing retailers and transporters to know the exact condition (status) of the package as well as its real-time location. The RFID technology helps guard packages against theft and misplacement.
GPS for easy tracking of packages and monitoring fleet movement
Global positioning system (GPS) enabled vehicles have streamlined package and fleet tracking processes. GPS helps P&M players obtain the real-time position of transport vehicles and goods. The technology allows for remote monitoring and helps maximise travel routes and minimise transit times.
AI and chatbots for customer service
With AI and chatbots, P&M players are in a position to offer 24X7 customer service to clients. Reducing manpower dependence, AI-powered chatbots help players provide interactive communication services to multiple clients at the same time. Giving out live updates about the movements of goods has become a far simpler and more efficient process using AI and chatbots. With routine package-related queries being handled by chatbots, human executives can devote their time and energy to address more critical business queries and complex customer interactions.
Digital apps for booking and payments
Digital is fast emerging as the first choice for initiating bookings for the transportation of goods in both residential and commercial P&M segments. With the growing adoption of digital in all facets of life, most clients are looking to complete the P&M process all online right from looking for service providers to booking a packer and transporter and making payments. The digital mode of transaction makes availing and delivery of P&M services a safer, trusted, and trackable transaction.
Mobile apps for driving better consumer experience
More and more players are looking to become tech-savvy and introducing a truck (fleet) reserving app. Such mobile apps offer clients end-to-end view and control of making a booking, tracking the goods movement, and making an online payment. Mobile apps are also helping service providers to collect consumer information, create a database, and manage individual client profiles effectively.
Challenges remain
Even as the P&M industry looks to drive greater adoption of technology, barring big pan-India players, most of the P&M players face technology challenges. These include:
Poorly architected infrastructure and underutilisation of IT resources at collection points and warehouses are the biggest reasons for P&M players struggling to streamline their supply chains.
The inadequate information technology infrastructure in the logistics industry and across warehouses makes the implementation of third-party logistics technology a challenging task.
The industry continues to struggle with the lack of standardised hardware or software solutions. This increases technology rollout costs.
Lack of technology-powered security systems in warehouses and transport fleets results in the loss of goods and poses a higher risk of theft and fraud.
Embarking on a digital transformation journey
Challenges notwithstanding even smaller players can embark on a digital transformation journey by adopting technology in one key area that has a huge potential to reduce human interventions by automating recurring processes and functions.
Be it a big organisation or a smaller one P&M players need to have leadership buy-in for the technology interventions in the business. An informed view of relevant technology tools that can help the workforce increase their productivity and their effective deployment is going to be the key to transforming the P&M business landscape.
Winning the customer and the market with transparency
The fast-growing P&M industry continues to struggle with a lack of transparency. Players are facing a loss of trust in a market where some vendors and P&M service providers disappear with client money and belongings overnight. With the increase in usage of P&M services, frauds are on the rise. Greater adoption of technology can help players put in place water-tight operating procedures bringing down and eliminating scams.
Technology interventions across the value chain can empower P&M businesses to bring more visibility to every function and person across the organisation. Greater transparency riding on widespread technology adoption will result in greater productivity and profits for the P&M industry.
In the long run, in a dynamic fast-growing P&M market, players that are technology savvy and have a distinct focus on transparency are going to survive the crowded market. Established and big players who are still working with legacy systems and old fleets sans tech-powered tracking systems risk losing ground to new and agile start-ups that are running their businesses with a tech-first approach.
(The author is Rahul Pillai, Founder and CEO of Hybrid Shifting Solutions India Pvt. Ltd ., and the views expresses in this article are his own)
