The economic progress of a country is largely dependent on its transport and logistics sector as it is the backbone for the growth of all other sectors. While the overall Indian transport and logistics sector has been on the rise and is reported to grow almost fourfold by 2027, it is still unorganized and underutilized with the traditional offline-based business model being followed by individual contractors and lorry owners to earn new business and grow their business network.
Unlike other developed countries, where the overall transportation cost is only around seven per cent of the GDP, it’s around 14 per cent of India’s GDP. In a country that has more than ten million transport vehicles, a typical lorry runs for 15-16 days a month and then has to wait for new work assignments, due to inefficient networking.
After realizing a gap in the transport market in terms of technology and the adoption of latest developments, Karan Shaha and Vikas Chandrawat started the transport community platform, named Vahak in 2019. For the IITian duo, irregular freight, lack of communication channels, distrust and a lack of visibility were evidently critical issues that needed immediate answers. On digging deeper, they saw the opportunity to improve the lives of all road transport logistics players through a digital ecosystem.
Vahak is an open road transport community platform for the transport industry that helps transport SMEs, lorry owners, and shippers get assignments while growing their business network and profit margins. Vahak already has 18 lakh transport SMEs and lorry owners on the platform and is facilitating a monthly transaction of more than Rs.40 million. With an employee strength of around 120, Vahak has a perfect mix of both fresh faces as well as industry veterans who are well aligned with the mission and vision of the firm.
The Inception Story
Both Karan and Vikas graduated from IIT Kanpur in 2015. After their graduation, while Karan started working as a Business analyst, Vikas was working as a consultant. During that time, Karan got to know about the hassle people were facing while booking transport vehicles in his hometown Raipur, Chhattisgarh, because of the fluctuating prices and the difficulties in finding trusted transporters. After doing market research, they realized the huge magnitude of the problem. Even though transportation and logistics have been considered the backbone of our country’s economy, the sector was extremely inefficient at that time. To understand the problem in more detail, both of them moved to Karan’s hometown and started their transport company in 2016.
For two and half years, they explored the entire ecosystem, from visiting factories and transporting
their loads, renting out trucks to managing the entire operations. Meeting more than 1,000 transporters and lorry owners during this time, gave them deep-rooted insights into the issues that SMEs and lorry owners face frequently. So, in 2019, both of them pivoted to a pure technological approach and started Vahak. The first 500 transporters were personally onboarded by both of them. Later on, as the number of transporters started gradually increasing on the platform, they moved their operations to Bengaluru, raised funds, and have been developing the team and the technology that backs the ecosystem.
Empowering Transport SMEs in the Market
As compared to its peer companies, Vahak is more of a community. As a platform, the firm’s primary goal is to empower every single lorry owner and transport SME in the market. While its peer companies are mostly transport companies and provide services to the shippers without empowering anyone on the supply side of the industry, Vahak, as a platform, is supply focused and is aimed at organizing and powering the supply side. While its peer companies mostly function on transportation-based operations, Vahak, enables its transport SMEs to give better services to their shippers. “We essentially help transporter companies to book lorries from the market. The first major differentiating factor is that we are a community and are focused on the supply side. The next major factor is that unlike other transporter companies in the market, we are a technologically driven platform and are not a service provider”, adds Karan.
One of the major issues that transporters face in an offline market is finding relevant loads on time and usually waiting for around 3-4 four days to get it. The primary expectation from an open marketplace is to get orders fast. However, they usually get in touch with many transporters and lorry owners as soon as they onboard Vahak, which helps them expand their business network rapidly as compared to their limited offline network.
Vahak helps them get loads faster and improves the efficiency of their business operations. Both Karan and Vikas have always prioritized the best conditions for a transaction to go forward. In addition to bringing in verified supplies, the community platform also verifies identification and other documents such as RC, insurance, fitness, GST, Aadhaar, for every single lorry owner. They have made sure to create a platform for safe payment transactions and are planning to bring in features, such as transit and cargo insurance and documentation, onto the platform.
As a purely digital platform, Vahak is continuously improving automatic recommendations on its platform through machine learning and AI to improve overall marketplace performance. The firm has tied up with GPS providers, FASTag providers and is enabling features, such as Sim Tracking, on the platform. One of the major benefits that every single user gets out of Vahak is that as a purely digital platform, it drastically reduces the transporter booking time as compared to the offline market. “At the end of the day, we are providing end-to-end digitized solutions for lorry owners and transport SMEs, where at the click of a button, lorries can be booked and tracked. They can also do insurance easily”, says Karan.
Unlike the other trans¬porter com¬panies in the market, Vahak is a technologi¬cally-driven community platform
Vahak is focusing on the transaction to happen between cities and has been mostly focusing on large commercial vehicles that weigh more than six tonne, such as trucks, trailers, containers, tankers, and so on. The majority of the users and clients come to Vahak with bulk requirements. Addressing this, the company is planning introduce premium features and help transporters access bulk requirements faster as part of its spot market premium plan.
Future roadmaps
Coming to its future plans, Vahak is looking forward to provide solutions for other facets of the transport sector that are not being technologically driven presently. The startup is creating an entire ecosystem around the transport and logistics community. Other than helping its clients procures loads and safeguarding their entire transaction, Vahak is working on creating an entirely alternate marketplace of value-added services, such as fuel, FASTag, GPS, body parts, and so on. “We’ve captured around 2-3 percent of India’s market at this point and in the next 18 months the goal is to capture more than 15 to 20 percent of this market. Being a tech-driven platform, we have the power of distribution and can link every single city and village without being physically present there”, adds Karan.
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