Strengthening shipping, warehousing and logistics for D2C brands in tier II and tier III cities

shipping and logistics
(Last Updated On: May 19, 2023)

eCommerce has recently seen exponential development, fuelled by the COVID-19 pandemic, drastically altering our lives.

The eCommerce sector is predicted to rise to $111.40 billion by 2025, up from $46.2 billion in 2020. It is estimated to reach $350 billion by 2030. Smaller cities accounted for less than 30% of eCommerce sales before the pandemic.

However, this has been complemented in India by increasing internet and smartphone penetration in urban and rural areas. As buyers seek online solutions for their supply of critical products, the epidemic has aided the rise of online shoppers in Tier 2 and Tier 3 cities.

Furthermore, reduced data costs and digitalisation have resulted in widespread tech adoption. As a result, the number of direct-to-consumer (D2C) brands in the country has increased significantly.

With the smart cities mission, logistics businesses can no longer rely on a select few major cities in India to make a difference in the logistics sector.

Logistics companies are modifying their offerings to meet the needs of this rapidly expanding market in Tier II and Tier III cities. Businesses and SMEs want to partner with logistics providers that add value to their core product offerings.

Warehousing in tier II and tier III cities

Tier II and III cities are emerging as new consumption hotspots as India undergoes an eCommerce shift. This has resulted in increased demand for storage in these areas.

The expansion of warehousing in Tier II locations in India is well encouraged by various state governments through infrastructure development programmes such as highway construction.

The rising expectations of the tier II and III populations and increased access to high-speed internet have resulted in an increase in eCommerce demand in these areas.

Related read: How Indians shop online in 2023

According to industry estimates, non-tier I markets account for more than 60% of eCommerce revenues and 90% of new customers. These customers, like those in Tier I markets, want speedier and more rapid fulfilment.

Indeed, in metropolitan areas, the eCommerce business is rapidly shifting from a two-day to a two-hour delivery model for groceries and other time-sensitive SKUs.

Major eCommerce businesses are extending their supply networks in small communities to meet this growing demand.

Assessing Shiprocket’s impact on eCommerce shipping 

Shiprocket collaborates with 25+ courier partners at rates beginning at Rs. 20/500g to guarantee that our clients can deliver to every corner of the country. In addition, we provide CoD as a payment method to merchants.

Furthermore, our Early CoD service allows you to get your CoD amount in 2 days rather than the usual 7-9 days. We’ve included features like pickup escalations and multiple pickup addresses to ensure your shipment arrives on schedule.

Here’s what our Shiprocket data tell us about shipping to tier 2 and tier 3 locations and boosting Bharat commerce among our vendors: 

  1. Small and medium vendors selling in tier 2 and 3 cities construct around 50-70% of Shiprocket’s order contribution. The main selling channels include social media platforms such as Facebook, WhatsApp, and Instagram, as well as their website.
  2. Mobile covers, organic charcoal, Ayurvedic pills, T-shirts, and sarees are the most popular items in these cities.
  3. Shipments to Tier 2 cities have increased by 10% yearly. This pattern is predicted to continue in the following year.

Final thoughts

 With so much valuable information at our disposal, we can see that Bharat commerce is on the rise. Furthermore, shipping systems such as Shiprocket can assist these merchants in completing the end-to-end eCommerce process.

Tier 2 and tier 3 cities are becoming essential to eCommerce company strategy, and you should also integrate such services.

Your shipping processes could be much smoother with an eCommerce website. Don’t have one yet? Try out Instamojo to create an online store which allows you to partner with trusted shipping partners. You can then automate shipping and get orders to customers hassle-free.

Create an online store

This article has been written by the content team at Shiprocket. You can connect to them here. 

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