ShopClues

Logistics
SYNDICATE 3
Bambang Sugiharto
Bara Yohantomo
Bobby Mandala Putra
Cikita Tiara
Daniel Gani
Daniel Hasudungan Sibarani
 What is ShopClues.com?
• Shopclues.com is India’s ‘Unicorns’ online marketplace.
• Founded in Silicon Valley in July 2011.
• A subsidiary of Clues Network Inc., a US based corporation.
• Founded by Radhika Aggarwal & husband Sundeep Aggarwal, Sanjay Sethi.
• Has around 1100+ employees with Headquarters in Gurgaon, India.
• CEO of the company is Sanjay Sethi.
• It has 30 million+ registered customers, 650,000+ merchants, 16 million+
products across 5000+ categories at attractive prices.
• 100 million+ monthly visitors, 7500+ brands, 8 million+ Facebook Fans
Main Page of shopclues.com
 Top Online Marketplaces in India:
The Competitors

Leaders

.in

Others Local
Players

Source: indianonlineseller.com, nextwhatbusiness.com

 Internal Factors External Factors

• It has 7,500+ • Relatively less brand • Expansion to other • Distrust of

national and countries company, its
visibility in metros
international brands. in comparison to its • Heavy promotion to technology, product
get more customers originality, etc
• A large merchants strong competitors. in tier 2 and 3 cities.
base comprising of • Increased
• Limited market • Expansion to other competition from
650,000+ merchants. share growth due to product categories,
as customer ecommerce giants
• It lists 16 million+ intense competition preferences are fast like amazon,
products across changing flipkart, etc
• Loyalty among
5000+ categories. suppliers is low • Acquisition of • Heavy discounts
ecommerce portal to offered by offline
• Products are shipped strengthen their
to 12,000+ cities.
• Business Model of positioning. stores
Shopclues.com can
• Strong brand be easily imitated • Sale of private labels. • Growing
recognition. • Increasing customer technological
by the competitors expertise of local
base in lower
• Well managed segments players
Reverse Logistic
System

S W O T
 What is Shapclues’s Operating Model?
• It is a business to consumer technology platform that connects Tier 1, Tier
2 and Tier 3 customers.
• It operates as an online marketplace that adopt a zero-inventory (managed
marketplace) model based in India.
• Shopclues charges 12% selling service fee on every successful transaction.
• Shopclues targets small businesses like retailers and shopkeepers and
encourages them to sell their stuff online.
• Shopclues also provide support to the sellers through helpline and emails.
• Shopclues provide an ultimate platform to small sellers to showcase and
sell their product all over India.
• Shopclues deliver products to over 30,000 PIN (postal index numbers).
 How it is different from Others?
• Shopclues has wide range of merchants of their site.
• It has 16 million+ products whereas Snapdeal has only 10 million+.
• Sanjay Sethi, the CEO and Co-Founder said, “our main focus has always
been to have the highest selection of products and offer them at lowest
price”.
• Fast Delivery up to smaller cities and rural regions.
• Innovative Promotional & Marketing techniques.
• Shopclues does not charge any Subscription & Listing fee to the sellers.
• Focuses on unstructured products such as home and kitchen appliances,
small electronics.
• Target Market: Mainly Middle Class People with average age 26 years.
A WIND OF CHANGE
• ShopClues change its strategy to
outsourcing by third-party
logistics (3PL), which involved
using a combination of national
and regional partners. ShopClues
also shifted from an air mode to
an express surface mode of
transportation.
• 3PL partners included traditional
logistic services providers (LSPs),
e-commerce-focused logistics
providers, and India Post.
The benefits
Complete package.
3PL companies offer complete services from procurement,
storage, to packaging and delivery. With this, ShopClues can
reduce investment in logistics infrastructure.
Wider reach.
With 3PL companies, ShopClues can expand their reach to
include Tier 2 and Tier 3 cities, where Cash on Delivery
(COD) is preferred mode of transactions.
Ensure delivery time
With offering services as express/non-express road
transportation and route/delivery planning, 3PL can ensure
a clear delivery time.
Accountable.
With the help of real-time tracking and reliable
documentation, everything in the process becomes
accountable to both ShopClues and customers.
Special value-added services.
With the help of 3PL, ShopClues can offer special services that can
earn customer trust more, such as time-bound deliveries (same day
or next day deliveries), card (swipe) on delivery, and parcel lockers.
 The Role of 3PL
• The role of 3PL partners become vital in the process from the
moment the customer’s order was placed and assigned a number.
• The DSS determine a suitable 3PL partner based on multiple factors
such as SLA for pickup, shipping, and last-mile delivery; SLA for return
to origin (RTO); and cost of RTO (for reverse orders).
• Then order-status flow to 3PL partner selected by the DSS through
pickup API.
• The 3PL partner need to make at least 3 order delivery attempts
before initiating an RTO (for reverse order).
 Order placed by customer Forward order Process flow using DSS
[Courier assignment optimization Model]

[Serviceability Check]
Calculation of serviceable courier partners (Current system)

DSS – [Elimination Rule Engine]

Courier elimination based on rules. Result = Final set of serviceable couriers post elimination
Order
Marketplace, 97%
Courier assignment through DSS
Fulfillment center, 3%
Fulfilment
Fulfillment
Basic type of order Premium

Orders manifested & packed by vendor Milk run arranged by FC at vendor place

API Integration
Information flow to courier through Pickup API Milk run arranged by FC at vendor place

Handover the consignment to assigned courier by Order status updated as shipped

through connection API
Handover the shipment to assigned courier
vendor – Order moved to HTC Stage by API

Order status updated as delivered or

RTO through tracking API

Arrange RMA (Reverse pickup) from customer Post delivery

under outsourced/Doorstep QC model YES issues NO Order placed by customer

Arrange replacement or refund to the

customer basis the case requirement
 The Importance of Reverse Logistics
• To protect the customers interest, Shopclues has a well structured
return and replacement policy for products that were damaged,
unsatisfactory, or the wrong product.
• ShopClues provides ‘Doorstep-Quality-Check’ and ’Return-to-Seller’
services to its customers.
• ShopClues has a network of reverse 3PL partners for handling 4,000
reverse orders per day across 14,000 PIN codes.
• In a delivery process, 3PL is instructed to send back the product/RTO
to the seller after 3 unsuccessful delivery attempts.
 Customer receive the product Shopclues’s
Must be
within 10
days
Reverse
Customer file a return request on the portal Material
Mismatched
Flow System
Damaged
Reason for return

Arrange to be sent Yes Cause of damage No

classified as a merchant
to merchant or 3PL liability

ShopClues confirm the refusal

from merchant or 3PL to
accept the product back

Arrange to be sent to
merchant or 3PL Arrange to scrap the product

Pick-up arrive to customers location

within 2 business days without additional fee from customers
 Reverse Material (Cont’d)
• In ShopClues, over 95 percent of customer who returned items
received refunds within 12 to 24 hours of pick-up.
• In special cases, such the cities that aren’t covered with reverse 3PL
services, the customers can do a self-shipment. The cost of the
couriers then can be reimburses in the form of ShopClues loyalty
points, or ‘Cluesbuck’.
 What is the role of Technology
in Logistic Management of ShopClues?
• Shift from inventory model to marketplace model
• Task Automation, for faster logistic service with less cost and higher quality
• Online Tracking, giving information of the products being shipped (status,
location)
• ShopClues built a plug-and-play (system integration) technology platform
for real-time exchange of date between ShopClues portal and 3PLs,
facilitating effective communication.
• It help with demand management by allocating order volumes based on
partners’ capacities and past delivery performance.
• ShopClues also in the process of developing individual application program
interfaces (APIs) of different logistic partners.
 CONCLUSIONS
• Shopclues follows a Marketplace model and zero-inventory led model
to reduce the cost reduction.
• They concentrated equally on the Reverse Logistics to achieve sky
level success by the help of 3PL logistics partners.
• Shopclues wants to increase it’s Just-in-Time concept and they want
to concentrate more on reverse logistics
 Thank You!

India’s first and largest managed market place