Did you know that the truck next to you on the highway is empty 35% of the time? The phenomenon of trucks driving back empty (empty miles) to the place of origin in the absence of a return load is estimated to be as high as 25% in India. That’s clearly a big deal for the environment. Besides, with higher spends on fuel and lower revenues, operators end up neglecting maintenance, taking a toll on their fleet quality.
“The issue with empty miles is that the spends-meter keeps ticking – be it the EMIs or fuel costs – while the asset is unutilised or underutilised. If capacity exists, it must be used. And that is what we at Raaho are trying to do 24×7, so that the lives of truckers and drivers can be improved,” says its CEO & co-founder, Md. Imthiaz.
As per a recent Niti Aayog report, CO2 emissions from freight transport are likely to go up by 451% – to 20 giga tonnes – in 2050. It says that 2.7 giga tonnes of emissions could be avoided and Rs 85 trn saved by reducing empty running, improving load factors and using bigger trucks. It is in this domain that Raaho is trying to bring in efficiencies.
Incepted in 2017 with just 10 trucks, Raaho is an on-demand intercity trucking management company that focuses on middle-mile logistics. The brainchild of Imthiaz, it’s a new age tech-enabled broker which uses technology and real-time data to ensure freight tracking and on-time delivery, and enables operational and cost efficiencies in an otherwise opaque industry. The firm envisages building a reliable freight marketplace connecting shippers and truckers nationwide through its efficient digital freight network.
Raaho’s network creates liquidity through its marketplace-based instant trucking and tracking solution. Load is made available to trucks and trucks are made available to shippers typically within 30 minutes. As a result, the monthly utilisation of trucks has increased from 7,000 km to 11,000 km. “With improved utilisation of assets, the average earnings of truckers and drivers have gone up. This, in turn, has led to greater pass-through money for the immediate community of interest, which comprises 15% of India’s population that earns a livelihood directly or indirectly through trucking,” says Imthiaz.
Trucking in India is waiting to be uber-ised; adopting digital freight matching will marry loads with trucks in the vicinity, he explains. McKinsey has estimated a 5-15% revenue upside through back-haul visibility (return load certainty) and a reduction in costs by 3-5% if the issue of truck utilisation is addressed. He stresses that digitisation ensures not just efficiency in trucking by bringing in a discovery layer but also transparency – with vehicle tracking and instant digital payments for truckers – and reliability – with verified partners, be it shippers, truckers or drivers. “The action in India has already started with Raaho, something akin to Blackbuck convoys in the US.”
He says Covid and the resultant lockdowns saw about 12 mn trucks and drivers thereof venturing into the digital world. But not more than 1% of freight matching in India has gone digital to date. With increasing adoption of the digital platform, “Covid has actually been a blessing for the future of logistics in India. This could revolutionise an otherwise opaque and fragmented industry plagued with 2,00,000 brokers who are still into manual phone-based matchmaking within their immediate network,” he adds.
STEERING AHEAD
Raaho packages its on-demand trucking solution through its complete suite of apps (Shipper app, Trucker app, and Driver app) to offer close-by discovery, vehicles with verified documents, shippers of credibility, real-time tracking of freight-loaded vehicles and instant digital payments. This is made possible firstly by leveraging technology and data-science, then by a large network of shippers and truckers on Raaho and lastly by access to verified digital e-KYC and integration with UPI or Paytm-like digital payment platforms.
