In an interview, Rajesh Yabaji, co-founder of BlackBuck (Zinka Logistics Solution Pvt. Ltd), talks about what appeals most about company to customers and suppliers, the challenges in building a technology-driven logistics firm in India, and maintaining growth momentum. Edited excerpts:
What makes BlackBuck an attractive destination for customers and suppliers?
Customers are integrated digitally on to our platform. Their SAP or Oracle systems get integrated into our platforms. These suppliers are plugged into our systems through a mobile app. As soon as the information comes in, it seamlessly passes through an intelligent pricing engine. Based on the price, the system pushes these orders to all eligible truckers on the platform. That is essentially the marketplace. This marketplace has all the rules that customers want the trucks to be aligned to. It has all the rules that a supplier wants the customers to be aligned to. For instance, a supplier’s truck does not show up on time. Or say, a supplier promises to load a truck in four hours, but doesn’t. All this data is indexed on the platform which helps in identifying quality suppliers. On the customer side, the way they treat suppliers also matters. Suppliers also rate all these experiences. We try to manage the most adequate supply with the most relevant customers.
How do you ensure a steady supply of trucks?
Bringing in supply is a segment where we have matured over time. Today, we have channel partnerships, oil partnerships, we have got tyre company partnerships, we have finance company partnerships. All want their customers to be on our platform. Through them we get access to supply. This apart, we access supply from toll gates, mandis, dhabas etc.
But, we don’t believe in captive supply. If you deconstruct a marketplace, it is like, if I have a truck and need demand, I will go to the BlackBuck platform. I get demand at the right price. If these core values are fulfilled, you can build an entire business around that. The entire aspect of treatment of supplier partners, how communication happens, etc. becomes a value proposition for suppliers. Customers in turn experience gold standard management.
How challenging is it to drive technology adoption among truck owners?
Truck owners are generally progressive and have an intent to use technology. Technology adoption is high there. But there could be a challenge on the driver side. If you ask me, is technology adoption a big problem? Definitely. It is a problem to solve. But, has it reached a point to support the marketplace? Yes. This is because truck owners see the value, demand and right pricing. They see so much servicing on the platform that they want to be on it.
How does BlackBuck plan to maintain the growth momentum?
There is continuous growth for BlackBuck. We are at the tip of the iceberg. We are a large transporter for many customers, but we are not the dominant transporter. They don’t give me the entire order, hence I can strive and achieve that. Earlier, we were doubling our business every month. Given that the base has become big, now that possibly won’t happen. Again, there has been no fallout among clients.
What are the challenges in building a technology-driven logistics company in India?
Challenges are evolving. They are different at different points in time. When we started building the marketplace, customer acquisition was a very big challenge. When customers started coming in, getting the supply was a problem, hence we started solving for supply. When it came to scaling, technology adoption by customers was a problem. We solved that. Then technology adoption for supply was a problem, we solved that. Technology-oriented supply is what we want. We are on the cusp of scaling infinitely. What we are focusing now very obsessively is the platform experience, improving quality of the marketplace. We are using a lot of data-driven techniques to get there.
What factors have helped to make BlackBuck the firm it is today?
First, the leadership team. We have built an extremely strong leadership team. Second, an obsession about building a marketplace and not deviating from that. We have gone through trials and tribulations and internal conflicts. For instance, we can also offer express services, but we don’t. We do only FTL (full truckload). Third is choosing the right investment partners and customers to work with. Fourth, quickly moving into all structures processes and alignments necessary for a business to run properly.
We have committed mistakes, like moving away from platform experience and product-obsessed thinking in November and December of 2015. We were more obsessed about revenues and scaling. We did not have happy customers and suppliers. Fortunately, it was a short phase. The agility of the business was so high that course correction was quick. Somewhere, the platform experience had become secondary during that time.
The freight business is tough. If a person is trying to build a business model and makes three visits to a truck market, in all possibilities that person may not make the fourth visit. That perseverance is needed because all you get there is dust and sun.
Everybody has their own moats. Spending time in the market is very important. For instance, you go to a broker and he says I don’t have time for you. You can either leave or sit beside him for the next two hours and and watch what he is doing. The approach makes all the difference.