Quick commerce firm Dunzo and logistics start-up Loadshare are in talks with the Open Network for Digital Commerce (ONDC), a government-backed initiative, to expand their respective two-wheeler fleets to offer bike taxi services.
According to sources familiar with the matter, the move is aimed at boosting the companies’ delivery capabilities and tapping into the growing demand for affordable, on-demand transportation services in urban areas.
Already on ONDC as logistic service providers, Dunzo and Loadshare are now preparing to become seller apps in the mobility category to aggregate supply.
While neither company has confirmed the discussions, industry experts believe that such a partnership could have a significant impact on the Indian ride-hailing and logistics markets.
ONDC forayed into mobile services with the induction of Bengaluru-based auto booking app Namma Yatri’s arrival on its platform. Paytm, the first buyer-side app to go live on the network, is expected to launch mobility category on its platforms soon to enable it users book auto rickshaw rides on the app.
The addition of mobility as a category fits well with the fundamental principles of ONDC which is to build digital public infrastructure to unbundle ecommerce demand and supply and make them interoperable for everyone to compete on the merit of their products or services.
In mobility sector, sub-optimal usage of fleet is the biggest challenges for logistics and delivery platforms. Mobility, in most categories, is a dual peak business. To overcome this challenge, logistics companies are now exploring novel approaches to maximize fleet usage by catering to different demand peaks and distributing demand throughout the day. This involves scheduling mobility (taxi) services during the 8-10 am and 5-8 pm peak periods, while dedicating the non-peak 10-12 am and 3-5 pm time slots to logistics services and capturing the lunch and dinner food delivery peak of 12:30-3 pm and 8-10 pm periods. This allows urban logistics firms provide better business prospects to their riders while also enabling drivers to meet their daily earning targets without having to extend their work hours.
“Today logistics players do logistics and food delivery for marketplaces. The same driver also could be used for mobility. The idea is to get all three modes of demand for the partners. It is a very practical proposal for both logistics companies and for the driver community, the conversations will have to progress further to materialize,” one of the sources said.
ONDC will collaborate with partners to launch two-wheeler taxi services in locations where there are no regulatory barriers. However, as a facilitator for digital commerce infrastructure, ONDC does not have a city-specific approach. The decision to go live in particular cities rests with the buyer and seller apps, people close to the developments said.
Email queries sent to ONDC, Dunzo and Loadshare did not elicit any immediate response till the time of filing this report.
Meanwhile, ONDC is actively pursuing the expansion of its mobility category to include other use cases. To this end, the company is engaging in talks with several potential network participants who have expressed interest in bringing diverse modes of mobility services onto the ONDC network. The discussions involve potential partners for metro services in four cities and other mobility services such as cabs, auto rickshaw, and two-wheeler services in other urban locations.
“Ever since the launch of mobility category in Bengaluru, a lot of companies are showing interest in launching different services in various cities. Some incumbents want to expand to ONDC to get their fleet utilized better while new players from various cities are looking to join either on the supply or demand side,” said one of the sources.
As a next step, ONDC aims to facilitate multi-model transportation options by providing a single ticket or QR code that covers various travel modes, such as intra- and inter-city buses, metro, sub-urban rail, cabs, as well as two and three-wheeler services, to cater to the first and last mile travel requirements of users.
Also Read: ONDC forays into mobility sector; ties up with ride-hailing company