Online Platforms Experience Shortage of Delivery Personnel
Online platforms are starting to witness a sudden drop in delivery personnel hampering to meet rising demand, while supply side challenges rise across the gig economy.
Swiggy, Zomato and Zepto among others are experiencing a delay in delivery timelines, due to delivery personnel dealing with rising fuel prices, including inflation in the economy, and some seem to consider returning to pre-pandemic jobs.
As a result, Swiggy has closed its pick-up and drop-off Genie for now in cities namely Bangalore, Mumbai and Hyderdabad.
Data analyzed by restaurant ordering and discovery platform, Peppo, indicated that rider assignment increased by 10 percent between March and April, yet the delivery time show a spike of 2.5 times.
“Not only is it taking slightly longer for the network to find riders, but the riders are traveling longer distances for every order, said Naman Pugalia, founder of Peppo. “There is a supply crunch, which has led to two kinds of inflationary pressures. Anecdotally, I am seeing orders which should take 20 minutes ( to deliver) because the restaurant is nearby, is taking 45 minutes or longer. Both festival and macro factors are at play. There has also been a slight increase in the cost of last-mile delivery, which we are passing on to the customers,” Pugalia added.
“Because of the hike in fuel pricing, there has been a surge in the adoption of electric vehicles (EVs). This will save the cost for delivery associates and the last mile logistic operations,” says Nishant Vora, co founder and director of Grab.in
The supply crunch has not spared restaurants as they are impacted in double digits. Additionally, those with their own delivery partners are raising the compensation for the gig personnel. “We have compensated our riders for the increase in fuel prices. However, the weather conditions ( rains in Bengaluru, extreme heat in Delhi- NCR) have also caused the crunch, both by a surge in demand and lesser riders showing up at work,” said Anshul Gupta, cofounder of Eatclub Brands.
On the other hand, industry executives have observed that the demand for quick commerce startups have exacerbated the supply shortage in Bangalore, Mumbai and New Delhi.
Young delivery partners had joined the gig workforce in droves during the pandemic as employment options dwindled. Now, with the economy reopening, those jobs are coming back in the mix again, said Rituparna Chakraborty, co-founder and executive vice president of Teamlease.
Rising fuel prices are paving way for the electric vehicle domain. Grab.in has increased its focus on electric vehicles (EVs). “Because of the hike in fuel pricing, there has been a surge in the adoption of electric vehicles (EVs). This will save the cost for delivery associates and the last mile logistic operations,” says Nishant Vora, co founder and director of Grab.in.