Monthly Archives: November 2024

meesho

IPO-bound Meesho to change Indian parent entity’s name from Fashnear Technologies

IPO-bound ecommerce company Meesho’s board has approved changing the name of its Indian entity, Fashnear Technologies Pvt Ltd, to Meesho Pvt Ltd, regulatory filings made with the Registrar of Companies showed.

The company has sought approval from the Ministry of Corporate Affairs to change its name.

The Bengaluru-based company has already submitted an application with the National Company Law Tribunal (NCLT) for the flip.

Once the redomiciling exercise is completed, the renamed entity, Meesho Pvt Ltd, will become the ecommerce marketplace’s parent company.

“The proposed name change ensures that the corporate identity and brand identity are fully aligned, eliminating any inconsistency in public perception. This will enhance brand recall, stakeholder trust, and overall business positioning,” the company said in its RoC filing.

Meesho declined to comment on this development.

Before Meesho, several other companies have changed the names of their corporate entities to reflect their brands. This includes Swiggy, which changed the name from Bundl Technologies ahead of its IPO; Urban Company, which changed its name from Urbanclap Technologies (its older brand name); and Shiprocket, which was earlier known as Bigfoot Retail.

Most recently, quick commerce company Zepto’s Indian parent changed its name from Kiranakart Technologies to Zepto Pvt Ltd.

Meesho, which is gearing up for a public listing, has already appointed Kotak Mahindra Capital, Citi, JP Morgan and Morgan Stanley as merchant bankers for its issue.

In March, Meesho released its annual report saying it recorded 34% year-on-year growth in orders during the April-December 2024 period, at 1.3 billion. This equalled the number of orders it clocked in the fiscal year ended March 2024.

As of December 31, the company had 187 million unique annual transacting users — a 26% increase from the same period in the previous year.

A March report by brokerage firm CLSA noted that Meesho is currently at a gross merchandise value (GMV) run rate of $6.2 billion, and is estimated to grow at a compound annual growth rate (CAGR) of 26% for the next six years.

The research note estimated Meesho’s market share in terms of the number of orders for calendar year 2024 stood at 37%. However, in terms of GMV, its market share was around 8.5%, it said.

“As of CY24, Meesho increased its share of the retail ecommerce market in India from a low share to around 8.5% and leads in order count at 37%. The company attributes this growth to its value-led model, which has resonated with consumers seeking affordability and variety,” CLSA noted.

ET reported in January that Meesho had raised $250-270 million from Tiger Global, Think Investments and Mars Growth Capital in a funding round, taking that round’s total size to $550 million. The round — a majority of which was secondary transactions — closed with Meesho’s valuation pegged at $3.9-4 billion, lower than its peak valuation of $5 billion.

Author Credits- Pranav Mukul, msn

indonesia counterfeit goods

Counterfeit goods persist in Indonesia despite government curbs, renewed US complaints

Mangga Dua market has been thrust into spotlight yet again as a barrier to trade in the USTR’s 2025 National Trade Estimate Report, which has singled out the North Jakarta market as a bustling hub of counterfeit goods.

JAKARTA – Rampant intellectual property (IP) infringements continue to persist, particularly in the trade of counterfeit products, despite repeated attempts to curb the practice through government measures as well as pressure from foreign countries, especially the United States.

That is the reality on the ground, at least according to some merchants at Mangga Dua Morning Market in Ancol, North Jakarta, which has long attracted shoppers and bargain hunters in search of affordable luxury apparel and accessories such as handbags, wallets, toys and leather goods, never mind that many are knockoffs.

At one stall with two employees, the shelves were stacked with knockoff luxury goods, from counterfeit Coach bags to Louis Vuitton wallets.

Counterfeit goods of high-end brands cost more than Rp 1 million (US$59.26) on average, with the cheapest item priced at Rp 350,000, the employees said on Tuesday as they engaged in haggling with shoppers looking for better deals.

Aristo, who has been selling wares at the market for over a decade, offers knockoffs of mid-range labels in his compact retail space, which is filled with a variety of counterfeit bags and backpacks for around Rp 150,000 a pop.

He told The Jakarta Post on Tuesday that the market’s merchants were divided into tiers: so-called premium sellers offered genuine luxury brands with price tags reaching several million rupiah, while low- to mid-level sellers offered knockoffs for an upper price range of Rp 500,000.

Government raids were a regular occurrence at the market, Aristo said, especially those targeting “premium sellers”.

“But as you can see, they are still here,” he said, pointing to a row of busy stalls nearby.

According to Aristo, many Mangga Dua merchants source their goods from other wholesale markets in Jakarta.

“We sell whatever is right in front of us,” he said, suggesting that some merchants might not be aware that they were trading in counterfeit imports.

Mangga Dua market has once again been brought into spotlight as a copyright piracy and trademark counterfeiting hub, this time in the 2025 National Trade Estimate Report on Foreign Trade Barriers from the Office of the US Trade Representative (USTR), along with a general mention of “multiple online Indonesian marketplaces”.

The report was published on March 31, just a few days before President Donald Trump unveiled his sweeping tariff policy for hundreds of nations on April 2, though he backtracked exactly a week later with a 90-day pause, reportedly to open space for negotiations with affected countries.

In the linked 2024 Review of Notorious Markets for Counterfeiting and Piracy (Notorious Markets List), the USTR states: “There has been little or no enforcement actions against counterfeit sellers.” It also referenced stakeholders’ reports that “warning letters issued to sellers have been largely ineffective” and their “concerns about the lack of criminal prosecutions”.

Regulatory gaps

Trade Minister Budi Santoso said on April 20 that his office would continue to monitor and crack down “strictly” on the domestic circulation of counterfeit goods.

Moga Simatupang, the ministry’s director general of consumer protection and trade order, told the Post on Monday that the distribution of counterfeit goods might fall under offenses that cannot be prosecuted without a complaint from the victim, as stipulated in Law No. 20/2016 on trademarks.

He added that the IP Task Force, which comprises several ministries and state institutions, had conducted regular surveillance of various products that infringed intellectual property rights.

“Regarding the rampant [trade in] counterfeit goods at Mangga Dua, the government will immediately take follow-up action,” Moga said.

Industry Ministry spokesperson Febri Hendri Antoni Arif emphasized that regulating imports was crucial in preventing the entry of counterfeit products, pointing to Industry Ministry Regulation No. 5/2024 that requires importers to have a trademark certificate before getting the green light from the Trade Ministry.

The regulation was “aimed at filtering and preventing counterfeit goods from being imported into the domestic market in Indonesia”, Febri said in a statement on Tuesday.

However, this regulation was short-lived and subsequently replaced by Trade Ministerial Regulation No. 8/2024, which eased imports and removed the requirement for trademark certification.

According to Febri, the ministry had deemed as ineffectual efforts to trace and crack down on counterfeit goods in local markets amid a surge in import volumes, noting that it would be difficult for brand principals and trademark owners to file formal complaints since most were based overseas.

Andry Satrio, an economist at the Institute for Development of Economics and Finance (INDEF), told the Post on Monday that curbing counterfeit goods was a delicate and challenging issue.

For example, he said, if the government considered tightening import regulations, the US might view it as a form of trade barrier. This move could also restrict the flow of raw and auxiliary materials, which had led to protests last year from businesses with local operations and the government’s eventual policy reversal.

Andry also underlined that the trade in counterfeit goods involved illegal cross-border activities, so the government should strengthen the enforcement of IP rights through partnerships with other countries, such as ASEAN states.

Bhima Yudhistira, executive director of the Center of Economic and Law Studies (CELIOS), said on Monday that the counterfeit goods trade had become widespread in part due to lack of oversight in halting imports through unauthorized channels.

The absence of sanctions for both producers and retailers of counterfeit goods was another contributing factor.

“Though the government has confiscated some illegal goods, it was not significant,” he said, adding that retail sales of illegal goods accounted for 10 percent of GDP.

Author Credits- Ni Made Tasyarani, The Jakarta Post

UPS acquire Andlauer Healthcare Group

UPS strengthens healthcare logistics with Andlauer acquisition for US$1.6bn

UPS has announced it is to acquire Andlauer Healthcare Group Inc (AHG), a leading provider of logistics and specialized cold chain transportation solutions for the healthcare sector headquartered in Canada, for approximately C$2.2bn (US$1.6bn).

According to UPS, the acquisition will extend the global portfolio of end-to-end cold chain capabilities available to UPS Healthcare customers, who increasingly seek temperature-controlled and precision logistics solutions.

“Next-generation treatments are driving more complexity than ever, expanding the needs of healthcare customers and increasing demand for the integrated, end-to-end cold chain solutions UPS Healthcare provides around the world,” said Kate Gutmann, EVP and president of international, healthcare and supply chain solutions for UPS.

“Andlauer Healthcare Group will help us deliver expanded capability to our customers, driving best in class patient outcomes while contributing to our overall growth plans across the business. This acquisition marks another important step in our declaration to be the number one complex healthcare logistics and premium international logistics provider in the world.”

Following the close of the transaction, Michael Andlauer, founder and CEO of AHG, will lead UPS Canada Healthcare and AHG to expand the businesses’ specialized capabilities and meet the needs of healthcare customers.

“UPS Healthcare and AHG employees share a similar customer and patient-centric culture with a relentless focus on quality,” said Andlauer. “Once the transaction is completed, the businesses will offer an even broader set of specialized logistics services to customers throughout Canada.”

Author Credits- HAZEL KING, Parcel and postal technology INTERNATIONAL

zepto founder

Zepto founders tap Edelweiss, others for Rs 1,500 crore structured debt to boost Indian ownership

Zepto founders Aadit Palicha and Kaivalya Vohra are in advanced talks with Edelweiss Alternative Asset, domestic family offices and smaller credit funds for around Rs 1,500 crore (more than $175 million) structured debt, people familiar with the matter told ET.

The deal is aimed at acquiring shares from existing foreign investors to help the quick commerce startup consolidate domestic ownership ahead of its planned initial public offering (IPO), they said.

Edelweiss has submitted a binding bid, they said, adding that the loan carries a minimum interest rate of 16%, with an equity-linked upside that could enhance total returns to about 18%.

People aware of deal details said it is being executed at a valuation of nearly $5 billion, the same as when Zepto raised equity financing last year.

The transaction, with a tenure of three years, is expected to close by July and will see Edelweiss underwriting the bulk of the loan. “Edelweiss has given a binding term sheet and will anchor the raise by committing half of the amount,” said a person with knowledge of the matter. “The remaining Rs 750 crore is being raised from family offices and smaller credit funds, who are expected to come in on the same terms.”

Domestic shareholding may be 30%

They may end up generating an 18% return based on the valuation of the company during the IPO, the person added.

An Edelweiss spokesperson declined to comment. Zepto didn’t respond to queries.

The promoter-level acquisition financing will help the Zepto founders increase their stake in the company to around 20%, from the current 18%, said another person aware of the matter.

Zepto’s domestic shareholding will likely increase to more than 30% once the deal is finalised, said a person familiar with the development. Its biggest backers include Nexus Venture Partners, Y Combinator and General Catalyst, among others.

Ownership threshold

The founders are undertaking the move to comply with foreign direct investment (FDI) regulations that govern online retail and meet the Indian ownership threshold, which could be crucial for regulatory clearances and IPO eligibility. India’s FDI rules allow 100% foreign investment in online marketplace models, but ban FDI in inventory-led ecommerce. Only Indian Owned and Controlled Companies (IOCCs) can legally operate inventory-led models. To qualify as an IOCC, a company must have more than 50% Indian ownership and control.

On April 19, the board of Eternal, listed parent of food and grocery delivery company Zomato, approved a proposal to cap foreign ownership in the firm at 49.5%, it told stock exchanges. The move was aimed at providing “greater operational flexibility” to quick commerce unit Blinkit by allowing it to hold inventory, rather than operate solely as a marketplace, as required under India’s foreign investment rules.

The Zepto deal “is classic promoter financing—a high-yield debt deal with embedded equity upside,” said one of the people cited above. But securing by a pledge of promoter equity is a rare instance for Indian new-age tech firms, especially with a high cash burn, the people said.

Previously, edtech startup Byju’s, online pharmacy PharmEasy and budget hotel chain Oyo have all resorted to loans because equity funding was difficult to snag, especially at steep valuations. Byju’s has defaulted and is bankrupt, while PharmEasy’s valuation was cut by more than 90% last year.

Zepto received National Company Law Tribunal (NCLT) approval on January 9 to merge its Singapore-based parent Kiranakart with Indian entity Kiranakart Technologies, streamlining its structure. In order to align with its consumer brand, Kiranakart Technologies has been renamed Zepto Pvt Ltd, show regulatory filings. The restructuring comes amid a broader wave of reverse flips by Indian startups seeking to tap domestic capital markets.

Secondary sale

Separately, Zepto is also closing a $250-million secondary transaction that will see participation from private equity firms including Motilal Oswal Financial Services, as reported first by Bloomberg. This secondary sale is designed to further increase Indian ownership and clean up the company’s cap table ahead of its public listing, another person familiar with the development said.

Palicha, Vohra and the employee stock ownership (Esop) pool together currently hold around 28% of Zepto, according to people in the know. The company aims to add another 8-10% of Indian shareholding through these transactions before the IPO paperwork is filed.

The push for higher Indian ownership also comes at a time when Zepto and its rivals are facing heightened scrutiny over operational models and profitability metrics in the quick commerce space.

In a recent LinkedIn post, Palicha said Zepto is nearing $4 billion in annualised gross order value (GOV), posting around 300% year-on-year growth and about 30% sequential growth since January. He also pointed to a 50% reduction in ebitda losses (excluding Esop costs) and operating cash flow burn over the past three months, with a target to achieve break even on both fronts soon.

Blinkit had an annualised GOV of $3.6 billion in the quarter ended December 31, 2024. Swiggy Instamart posted an annualised gross sales run rate of $1.8 billion in the same quarter.

The buzzy quick-commerce industry is seeing cash-burn levels rise sharply in the backdrop of hectic growth. According to an ET report on February 15, the sector’s monthly burn had surged to Rs 1,300-1,500 crore, led by intensified competition among Zepto, Blinkit, and Swiggy Instamart.

Eternal founder and CEO Deepinder Goyal had told ET in an interview that for its quick commerce unit Blinkit, “It’s about making sure the discipline of execution stays intact in the team. Our burn rate is 2-3% of the sector, while our category share would be 40-45%.”

Author Credits- Shilpy Sinha and Samidha Sharma, msn

mukesh ambani isha ambani

Mukesh Ambani, Isha Ambani’s aggressive plan to set up…, will compete with Deepinder Goyal’s Zomato, Swiggy Instamart, Zepto in…

Reliance Retail, Mukesh Ambani, Isha Ambani led retailer, reported a 2.4x increase in the number of orders from its quick commerce and hyperlocal delivery services during the March quarter. To further expand its reach, the company is planning to establish dark stores to enhance its coverage area.

During an earnings call earlier this week, CFO Dinesh Taluja highlighted this substantial growth, emphasizing the significant scale-up achieved in the March quarter.

“And we are seeing very strong traction with a 2.4x quarter-over-quarter growth in daily exit orders. And this number will scale up substantially in the coming year as well. We are also starting to proactively market this proposition, our proposition of no hidden charges, quick delivery, and no delivery fees continues to resonate very well with the customers,” said Taluja.

Reliance Retail VS Zomato Blinkit, Swiggy Instamart, Zepto

Reliance covers hyper-local deliveries, a sub-30-minute delivery, at 4,000 pin codes across the country through its network of existing stores, which has a much wider reach than any other quick commerce player in the country.

Through its JioMart app, Reliance Retail is offering quick and scheduled deliveries, which currently has three types of services.

There is an under-30-minute quick service, and second is a scheduled delivery, where the assortment is much wider, and then there is a subscription service, where a customer can subscribe and everyday goods are delivered at doorsteps early morning.

“All three are picking up very well. The average daily orders were up 62 per cent on a Y-o-Y basis,” he said, adding, “Specifically, our under 30-minute offering, which has the widest network reach. We have almost 2,000-plus stores which are on the network, covering more than 4,000 plus pin codes. So this is much wider reach than any other quick commerce player. We have kind of re-pivoted our model completely to under 30 minutes delivery.

There are already three major players currently in the quick commerce business like Deepinder Goyal’s Zomato Blinkit, Swiggy Instamart and Zepto. There are many other players with less market share like Tata’s Big Basket. If Reliance Retail becomes successful in its expansion plan in quick commerce it will be a challenge for these companies as once Reliance entered in any market it always disrupts it like it did with Jio in telecom sector.

According to Taluja, as part of the strategy, Reliance Retail is using its store network, delivering within a three-kilometre radius.

“There are some dark pockets where we will set up dark stores also, wherever there is a genuine requirement, there is enough volume and we cannot service it within 30 minutes, we may set up some dark stores as well. So that is on the quick commerce side of it.

“Our stores, purely on a standalone basis, are seeing double-digit like for like growth for last several quarters. So stores are also growing pretty rapidly. We are not seeing that impact either in metro or in any other city,” he said.

“So, we are increasing the speed at which we are able to deliver the products,” he said.

For the 2024-25 financial year, Reliance Retail had reported a gross revenue of Rs 3.30 lakh crore, up 7.85 per cent and profit after tax was up 11.33 per cent to Rs 12,388 crore.

Author Credits – Anirudha Yerunkar, India.com

Zus Coffee

Malaysia’s largest coffee chain Zus Coffee targets 200 Southeast Asian outlets this year

Malaysia’s largest coffee chain, Zus Coffee, plans to launch 200 new outlets in Southeast Asia this year, according to CEO Venon Tian in an interview with Bloomberg.

Zuspresso, the operator of the Zus brand, is targeting at least 107 new stores in Malaysia, 80 in the Philippines, and six in Singapore. It also eyes to set up the first stores in Thailand and Indonesia this year.

Last year, Zus surpassed Starbucks as Malaysia’s top coffee chain after five years of operation, with 743 outlets compared to Starbucks’ 320.

It also manages 120 stores in the Philippines.

Zus reported a threefold increase in net income to RM37 million (US$8.4 million) in 2024, reflecting its rapid growth.

Tian attributed the company’s success to its market-specific flavors, such as palm sugar-flavored drinks in Malaysia and purple yam-flavored coffee in the Philippines.

Zus, which started out as a kiosk focusing on coffee delivery in 2019, now sees about 70% sales coming from online channels, including deliveries and pickups.

Its tech-driven approach and cost-efficient store construction have enabled it to offer coffee over 20%cheaper than Starbucks, boosting its widespread appeal in Malaysia.

Zus drinks are price in the mid-range in Malaysia, between the RM5 price tag of convenience stores and RM11 of premium stores.

“It’s about how we make quality coffee accessible to most people,” Tian said.

News Credits- Retail News Asia

Majid Al-Futtaim

Majid Al-Futtaim expands lifestyle retail footprint across Saudi Arabia

Majid Al-Futtaim, a leading shopping malls, communities, retail, and leisure pioneer across the Middle East, Africa, and Central Asia, has announced the expansion of its lifestyle retail footprint in Saudi Arabia. As part of its continued commitment to the Saudi market, the group’s lifestyle business plans to open 13 new stores in 2025 — five already launched — bringing its total store count in the Kingdom to 31.

The expansion features a mix of global lifestyle and luxury brands across Riyadh and Jeddah. This includes the launch of the first Saudi stores for Italian smart luxury brand Eleventy and luxury menswear label Corneliani, both of which debuted this month at Solitaire Mall, Riyadh. In May, Poltrona Frau — the iconic Italian luxury furniture house — will open its first store outside the UAE at Centria Mall, further reinforcing Majid Al-Futtaim’s commitment to growing its luxury presence in the Kingdom.

Abercrombie and Fitch and lululemon also opened new stores in Solitaire Mall last month, marking an important step in their continued regional growth. The brands now operate six and nine stores respectively across the Kingdom, with new locations set to open in Jeddah later this year.

Fahed Ghanim, CEO of Majid Al-Futtaim Lifestyle, said: “Saudi Arabia continues to be a core focus for our business, and our retail expansion reflects both growing consumer demand and our confidence in the market. From fashion and wellness to home and design, our goal is to deliver more of the brands our customers love — while introducing fresh experiences through our exclusive global partnerships.”

“In a region where customers have an abundance of choice, our ambition is to curate a portfolio of global lifestyle and luxury brands that offer something truly distinctive in the Kingdom. By introducing brands like Eleventy, Corneliani, and Poltrona Frau, we are bringing new dimensions to the luxury market — combining timeless craftsmanship with modern sensibilities that resonate with the refined tastes of our customers.”

The launch of Eleventy in Solitaire Mall is part of an ambitious regional expansion for the brand with another four standalone Eleventy stores opening in key locations in 2025, including Mall of the Emirates, Marsa Al-Arab, Dubai Mall and The Grove in the UAE. Known for its commitment to sustainable practices and premium materials, Eleventy reflects the growing consumer demand for quality and subtle sophistication, all under the “Made in Italy” banner.

Marco Baldassari, co-founder and menswear creative director at Eleventy, said: “Eleventy’s philosophy of understated elegance and commitment to sustainability resonates strongly with the sophisticated Middle Eastern consumer. We are excited to strengthen our partnership with Majid Al-Futtaim, whose visionary approach to luxury retail is shaping a new vision with a growing focus on customer needs. Together, we aim to redefine luxury retail by offering timeless craftsmanship, sustainable practices, and innovative experiences.”

Majid Al-Futtaim’s lifestyle portfolio will also welcome a new Crate and Barrel store at Sahara Mall, Riyadh, reinforcing the brand’s presence in the capital. Meanwhile, in Jeddah, five new stores will launch at Jawharat Mall, including lululemon, Hollister, Eleventy, Abercrombie and Fitch, and AllSaints — bringing some of the world’s most in-demand fashion and lifestyle brands even closer to Saudi customers.

Majid Al-Futtaim’s retail expansion in Saudi Arabia builds on a record-breaking 2024, which saw a 26 percent increase in revenue across its lifestyle portfolio and a 31 percent surge in digital sales — including a 22 percent uplift in Saudi Arabia alone. The year also saw the opening of 17 new stores across the region, five of which are in the Kingdom, as well as flagship locations for brands such as lululemon, Crate and Barrel, and CB2, alongside 27 e-commerce platforms.

News Credits- ARAB NEWS

Unilever Q1 result

Unilever’s Q1 mixes strength and weakness

Consumer products giant Unilever has reported its Q1 results and they show varying performances across its different divisions.

The Anglo-Dutch consumer products giant has operations ranging from foods to household goods, personal care and beauty. And it’s these last two units that we’ll focus on.

Overall turnover fell 0.9% to €14.8 billion although underlying sales growth (USG) was 3%. In Beauty & Wellbeing, turnover rose 2.9% to €3.3 billion and was up 4.1% on a USG basis. Meanwhile in Personal Care, turnover fell 4.4%, also to €3.3 billion, but was up 5.1% USG.

Beauty & Wellbeing accounted for 22% of Q1 group turnover and that 4.1% USG rise divided into 2.5% from volume and 1.5% from price. Growth was driven by a strong Wellbeing performance, that was partially offset by a slower Beauty market.

Hair Care was flat with low-single-digit price rises offset by a low-single-digit volume decline. Dove grew in mid-single-digits, supported by its relaunch with “cutting edge fibre repair technology, new packaging and design”.

Its largest haircare brand, Sunsilk, was flat as it lapped a strong double-digit growth comparator and faced some destocking in Brazil. Nexxus grew strongly in double-digits, which was supported by the launch of its HY-Volume range. Clear declined as market growth remained challenged in its primary market, China.

Core Skin Care grew in low-single-digits driven by low-single-digit volume expansion. Both Vaseline and Dove continued to grow in double-digits though, supported by the rollouts of Vaseline’s Pro Derma Ceramide range and Dove’s body serums across the Americas. Pond’s launched its new Ultra Light Biome range across Asia which uses its cera-hyamino technology to hydrate and strengthen the skin barrier.

Prestige Beauty declined in low-single-digits “reflecting the slowdown in the beauty market”. But the group’s Hourglass and Tatcha brands continued to grow in double-digits as Paula’s Choice and Dermalogica declined. K18, a premium biotech haircare brand, grew in strong double-digits.

Personal Care also made up 22% of Q1 group turnover and its 5.1% USG growth divided into 2.7% from volume and 2.4% from price.

Dove, which represents around 40% of Personal Care’s turnover, grew in high-single-digits, boosted by both price and volume. This growth was driven by the continued success and rollout of Dove’s serum shower collection and whole-body deodorants. Its performance was also supported by its Super Bowl advertising campaign.

Skin Cleansing grew in low-single-digits and Dove led the charge again with strong performances in North America and Europe. The brand’s success was supported by Dove Men+Care, which introduced a new range of premium naturals and relaunched its core range with updated packaging and design.

Author Credits- Sandra Halliday, FASHION NETWORK

Global CEP market

Global CEP market predicted to hit US$595bn by 2031

According to a new report from The Insight Partners, the global courier, express and parcel (CEP) market is seeing healthy growth, and is predicted to reach a value of US$595.32bn by 2031 with an expected CAGR of 8.5%.

According to the Courier Express and Parcel Market Overview, Growth, and Trends (2021-2031) report, key drivers include the booming e-commerce industry, growing demand for same day and express delivery, and the growing demand for last-mile delivery that caters to the call for quick commerce services at local levels. Retailers are increasingly partnering with CEP providers to offer seamless delivery experiences, and this has prompted significant investments in logistics infrastructure, particularly in emerging markets where e-commerce penetration is rapidly increasing.

Consumer demand

The report suggests that consumer expectations for delivery speed continue to escalate, with same-day and express delivery becoming standard in many markets. This trend, initially popularized by Amazon Prime, has now spread across the industry, forcing CEP providers to invest heavily in express delivery capabilities.

The willingness of consumers to pay premiums for expedited delivery has created lucrative segments within the CEP market. Businesses are increasingly using express delivery as a competitive advantage, particularly in sectors like food delivery, grocery, pharmaceuticals and high-value retail.

According to the report, this has fueled investments in dense urban delivery networks, micro-fulfillment centers and dark stores to enable faster delivery timeframes. The growth in express delivery has also driven changes in sorting technology, vehicle fleets and delivery scheduling to accommodate tighter delivery windows.

Convergence of B2C and B2B services

Traditionally distinct B2C and B2B delivery networks are increasingly converging as CEP companies, the report states, with B2B delivery expertise in areas like scheduled deliveries, specialized handling and time-definite services being adapted for premium B2C segments.

Simultaneously, B2C capabilities in last-mile optimization, customer communication and flexible delivery options are enhancing B2B service offerings. This convergence is enabling CEP companies to use assets more efficiently across business lines and throughout the day. It is also creating competitive advantages for integrated providers who can offer comprehensive solutions spanning both B2B and B2C needs.

According to The Insight Partners, this trend is particularly evident in urban operations where density and asset utilization are critical to profitability. The operational boundaries between business and consumer deliveries will continue to blur as companies optimize across their entire customer base.

Author Credits- HAZEL KING, Parcel and postal technology INTERNATIONAL

power of category management

Unlocking Efficiency and Savings:The power of category management in retail and e-commerce

Category Management is procurement strategy that involves grouping goods and services into categories based on similar characteristics such as type, value, supplier, risk location or department. This process helps companies better understand and manage the total cost of ownership for each category, while maximizing savings and value in their purchases. Additionally, category management, streamlines the procurement process, strengthens supplier relationships, improves spend analysis, and helps mitigate risks, and offers various other advantages.

According to a report from SAP, firms that fully optimize category management could potentially achieve as much as US$114m in savings and more than a 500% return on investment, in addition to reducing risks.

Category-led procurement provides numerous unique benefits that can assist purchasing teams in improving efficiency and uncovering new opportunities, such as

  • Improved Insights- with spend organized into categories and having a single point of contact for all related suppliers, companies can get a better understanding of the costs, vendor performances and possible supply chain risks. Furthermore, a thorough understanding of contracts, pricing and market trends allow more strategic and profitable procurement decisions.
  • Increased Savings- Leveraging their expertise and insights gained from categorization, managers can secure better pricing and boost performance to lower costs. Moreover, with a long-term purchasing approach, they can capitalize on economies of scale to generate further savings.
  • Reduced risk exposure- with a thorough understanding of each vendor and fostering long-term relationships, category teams can take a more proactive approach to supplier management, minimizing the risk of working with unreliable or short-lived vendors.
  • Greater procurement efficiency- with proven, digitalized, and automated processes, teams can swiftly adapt to market shifts and allocate more time to value -added activities.
  • Better adherence to ESG and SR commitments- aligning goals, ensuring transparency, and implementing effective monitoring help companies meet their environmental and social responsibility commitments more easily.
  • Increased spend under management- Intelligent automation enables procurement to oversee more categories, thereby increasing the total spend under management.

In e-commerce category management is crucial as it allows business to rack spending across different product and service categories, evaluate supplier performance, analyze market trends, and gain insights into category dynamics. This helps the development of sourcing, pricing, promotion, and placement strategies that are aligned with the broader business objectives.

The functions of e-commerce category management are

  • Category Definition – This process begins by clearly defining the products or services that belong to a specific category. Next, assess whether the category can be divided into subcategories based on product features or customer preferences. It’s also important to establish boundaries to prevent overlap with other categories. For, instance, women’s apparel can be segmented by style, size, material, colour and, occasion, while excluding men’s. Children’s, accessories, and footwear.
  • Category Analysis – To effectively drive promotion and sales, it’s essential to understand the needs, preferences, and behaviors of your target customers within the category. This insight allows you to tailor your offerings accordingly. Additionally, keep an eye on emerging trends, market shifts, and growth opportunities. For instance, the rising demand for sustainable fashion is fueled by eco-conscious consumers who prioritize stylish, ethical clothing with minimal environmental impact. Also, evaluate the strengths, weaknesses, and strategies of competitors within the defined category to stay competitive.
  • Category Management Strategy Development – set clear, specific, measurable, achievable, relevant, and time bound (SMART) goals for the category. For instance, target a 20% increase in online revenue for the category over the next fiscal year by optimizing the product assortment and enhancing brand visibility. Identify potential growth opportunities such as introducing new products, expanding into new markets, leveraging better pricing strategies, or improving customer engagement. Create a detailed plan that outlines the necessary steps, resources, and timelines to achieve these goals.
  • Product Assortment Planning- Select products that align with your category strategy, meet customer needs, and reflect current market trends. Strike a balance between product variety and focus to avoid overwhelming customers. To optimize your product mix, consider launching a new line of eco-friendly activewear, discontinuing slow-selling basic tees, and investing in marketing campaigns to refresh your core denim collection. Additionally, account for the product life cycle within the category, planning strategically for new product introductions, promotions, and phase-outs.
  • Pricing Strategy Development – To set the right prices for your products, start by assessing their perceived value within the category and aligning your prices accordingly. For example, by adopting a value-based pricing strategy for your premium denim line, you ensure that the prices reflect the exceptional quality and unique design features that set your products apart.

Next, analyze competitor pricing to gauge where your products stand in comparison. Adjust your prices as needed to stay competitive, making sure any changes align with your financial goals and overall strategic objectives. Additionally, consider incorporating promotional pricing strategies, such as offering discounts, coupons, or bundle deals. For example, you could introduce seasonal discounts on select styles to attract more customers and encourage sales.

  • Promotional strategy development – Identify the most effective marketing channels by considering the demographics, psychographics, and behaviors of your target audience within the category. These channels could include online advertising, social media, email marketing, or in-store promotions, such as sponsored product banners on Amazon Marketplace. Once you’ve chosen the right channels, develop engaging promotional campaigns with compelling content, visuals, pricing, and offers that resonate with your audience and drive sales. For instance, to boost sales of your sustainable activewear, you could target eco-conscious fitness enthusiasts aged 25 to 40 with tailored social media ads or marketplace promotions.
  • Implementation and Monitoring – Once you’ve developed the different components of your e-commerce category management strategy, the next step is to implement it. For pricing strategies, this means updating the prices across your product listings using your catalog management software. To evaluate the success of the category, track key performance indicators (KPIs) such as sales, market share, customer satisfaction, and profitability. Based on these results, identify areas for improvement and make the necessary adjustments to the strategy to optimize future performance.

Category management aims to optimize product performance online and it offers a multitude of benefits such as;

  • Enhanced customer experience- effective category management establishes a well-organized, user- friendly product structure that makes it easier for customers to find what they’re looking for. Moreover, by curating products that complement each other you can encourage cross-selling and upselling, enhancing the shopping experience and making it more personalized for customers.
  • Increased sales and revenue- e-commerce category management allows you to gain category-specific insights, which can be leveraged to refine pricing strategies and create targeted promotions that drive sales while protecting profit margins.
  • Improved inventory management- category management helps monitor demand patterns and seasonal trends, enabling more accurate stock forecasting and reducing the risk of stockouts or overstocking. By prioritizing high demand products within each category, you can optimize order fulfillment, lower storage costs, and avoid excess inventory.
  • Deeper customer understanding- By analyzing sales data and customer behavior at the category level, you gain valuable insights into preferences and needs, allowing you to adjust your offerings accordingly. Furthermore, making timely changes to product assortments and strategies ensures that you remain flexible and responsive to shifting market trends and customer demands.

In e-commerce, category management relies on online data, customer behaviour, and digital shelf analytics, leveraging software to centralize, digitize, and optimize processes across all categories while providing actionable insights. This is achieved through automation, step-by-step guidance, real-time monitoring and analytics, strategy execution, integration, and the use of artificial intelligence.

Retail category management is centered around optimizing the store layout, product assortment, pricing strategies, and promotions to boost sales and profitability within the constraints of limited shelf space. It involves strategically positioning products to guide customer flow and promote impulse buys, while carefully selecting items that meet customer needs and maximize space efficiency. Pricing is thoughtfully set to remain competitive and profitable within the category, aligning with market trends to maximize margins. Well-planned promotional efforts are implemented to drive sales, and inventory levels are managed to prevent stockouts and reduce holding costs, ensuring product availability without excess inventory. By integrating these elements, category management seeks to enhance the shopping experience and achieve financial objectives.

Retailers use category management software to analyse, optimize, and manage product categories, enhancing efficiency and profitability by simplifying tasks such as assortment, data consolidation and analysis, shelf-space optimization, demand forecasting, pricing and promotion, and supplier management and compliance. Some of the software retailers use includes Centric Software, Oracle Retail Category Management Planning and Optimization, and SAP Ariba Category Management.

In conclusion, category management is a crucial strategy for both retail and e-commerce businesses, optimizing product assortment, pricing, and customer experience. By leveraging software tools and data insights, retail and e-commerce companies can enhance profitability, streamline operations, and effectively address customer demands.