Online businesses have successfully established a clientele for themselves within Pakistan’s business industry. Some have become household names, such as TCS’s e-commerce subsidiary Yayvo, Delivery Chacha, Daraaz and Foodpanda, while others are working to find a place atop this newly discovered platform.

According to Yayvo’s head, Adam Dawood, the estimated size of Pakistan’s e-commerce industry is about 120 million dollars (2016 figures). By 2020, its e-commerce market is expected to surpass one billion dollars. This e-commerce sector consists of multi-retailers and multi-category online stores such as Yayvo and Daraaz, and recently launched initiatives such Well.pk and the Warehouse, as well as e-stores which operate on a small scale. Recently, established brands from all sectors have joined the party with their own e-stores, such as Khaadi, PIA, Cinepax, and the popular taxi services Uber and Careem. These businesses vary according to segments. The bigger, more established services specialise in courier and on-cash-delivery. On the other hand, businesses such as Delivery Chacha are on-demand delivery services, which specialise in express delivery or last mile logistics.

The top five things Pakistanis buy online, according to a survey by Islamabad Scene are T-shirts, stitched and unstitched lawn, mobiles, electronic devices and footwear.

Online shopping sales show that the internet is now the preferred method of shopping for many of us who value convenience and time-saving

The turnover rate is high. Delivery Chacha’s CEO, Nashit Iqbal, says the company has had a year-on-year growth of 200 percent in terms of orders, clients and scaling of operations. Similarly, Yayvo’s website attracts over two million visitors a month, with a 25 percent month-on-month growth rate in order base. TCS, the delivery medium for Yayvo’s orders, makes 400,000 deliveries a day.

It seems surprising how the usage of delivery services has so quickly immersed itself into our culture. According to Iqbal, it’s only logical. “I think every adult having a CNIC and a bank account is directly or indirectly using the courier delivery business,” he says. “We purchase airplane and cinema tickets online and get them delivered, we order food from restaurants. Even if one places an order via website, you’re using the delivery business.”

Moreover, TCS E-COM’s CEO Salman Hasan stresses on corporate client needs as a vital role leading to the usage of delivery services. “Corporate clients used to outsource their delivery jobs to specialised package companies which had the experience, ability and capacity to cater to their requirements,” he explains. “Name any company in the industry. PTCL, Nadra, Mobilink, Unilever, P&G — they’re TCS’s major clients. It’s because our services fit in with their requirements. That’s how delivery services became popular.”

Major companies aside, niche sectors of the industry have tilted towards using these services, Iqbal points out. “A lot of women entrepreneurs are working from home, baking cakes, making clothes, selling shoes and bags. They use companies such as ours to deliver goods to their customers. We even run errands such as grocery shopping, paying bills, picking clothes from the tailor,” he says. “Chacha has even stood in a queue for three hours just to get train tickets for a customer!”

Customers themselves are leaning towards using these services over purchasing things in the conventional fashion. Ayesha Arshad Ali, a resident of Karachi, says, “I’d rather buy a kurti online in the comfort of my home over getting ready and go search for the same dress. The delivery might cost extra, but the convenience makes it worth it.”

Umaima Anis adds: “I love how products have become easily accessible. I order stuff from food to cinema tickets and can get them at my home within a day. For websites such as Reader’s Club, you have to pay a fixed monthly rent and you can order as many books as you like.”

With the delivery procedure being simple and convenient, it’s no surprise that we’ve grown accustomed to these businesses with such ease. TCS charges 150 rupees for deliveries under 1,000 rupees. Yayvo has introduced a 120-minute delivery service at 200 rupees, where customers can avail a delivery within two hours. Delivery Chacha charges between 99 rupees to 499 rupees, depending upon the distance, the weight of the product and the urgency of delivery.

There was a short protest happening on the streets. Our courier literally jumped off the mountain and walked all the way to complete the delivery on time,” says Salman Hasan, TCS E-COM’s CEO.

While customers enjoy the convenience of the deliveries, online businesses themselves certainly face challenges. “Even though internet penetration and smartphone usage has increased, the trust in e-commerce hasn’t grown at the same pace. People still fear the risk of fraud,” says Hasan. “Moreover, the majority of Pakistan’s population is unbanked. Customers who have a bank account cannot even use their debit/credit cards online as they are by default restricted from being used for online shopping. And don’t forget fulfilment failures,” he adds. “Failed deliveries occur when customers cancel orders, or even refuse to accept their orders at their doorsteps. Naturally, one failure would reduce their confidence in the business. Why would they order again?”

Umaima Anis concurs. “Once I ordered rolls from a reputable company and the ones delivered were flavoured differently. I’ve never ordered from there again.”

Iqbal points out that infrastructural concerns also hinder business operations. “Look at the roads that need to be fixed,” he says. “And the resulting traffic, of course. These things impact delivery times and riders have to be extra careful with product handling.”

Capacity management is also an issue. “Vendors promise large volumes for special campaigns like Independence Day or a sale week they’re hosting, and we ensure operational capacity from our end. Sometimes it turns out that the vendor is unable to fulfil capacity from their orders and ultimately our costs take the hit.”

Although challenges exist, the companies aim for growth and are looking at different areas to expand their businesses. Delivery Chacha is making use of technological advancements to increase its reliability and timeliness of delivery. Yayvo recently launched the flagship product of iDroid USA technologies, the iDroid Balr x7 phone, in Pakistan. They also continue to invest in research and product innovation for the future.

Companies such as Daraaz.pk and Foodpanda are heavily increasing their offering of products with much more to offer week by week.

The CEOs of TCS E-COM and Delivery Chacha both have quirky anecdotes to share. “Very recently, we had an order for Sana Safinaz that came from Rawalakot in Kashmir,” says Hasan. “There was a short protest happening on the streets. Our courier literally jumped off the mountain and walked all the way to complete the delivery on time.”

“I wouldn’t say unusual orders,” says Iqbal. “But yes, I find it interesting when people order something as small as a paan or a box of milk and then complain that the delivery charges are higher than the price of the product. It shows how much importance they place on convenience and time-saving.

Published in Dawn, EOS, May 7th, 2017