Open Source Ideas: Fleet Management.
To streamline expenses, working capital requirements and empower drivers.
There are millions of independent commercial vehicle operators in India, operating in the unorganized sector, providing services in the $14 billion dollar cab market1 and the $230 billion commercial logistics market2.
Despite the vast number of operators, the sector lacked organization and efficiency to tackle logistics and demand fulfilment of services at scale for India.
To address this issue, online aggregators emerged, aiming to bring organization, automation, and innovation to sectors like ride-sharing services, logistics and food delivery.
Quartz Magazine, in an article titled, “What’s one of the fastest-growing jobs in India? (Hint: Ola has something to do with it)” wrote:
“More and more Indians are getting behind the wheel—professionally.
People working in the “drivers and mobile-plant operators” occupational category in India nearly doubled from 2.2% in 2007-2008 to 4% in 2017-2018, according to data from the Periodic Labor Force Surveys (PLFS) released by the statistics ministry in May 2019”
Current levels are at 3.86% in 20223. This reduction can be attributed to significant impact of COVID-19, soaring fuel prices and considerable attrition of drivers.
While aggregator startups did address demand fulfillment through great distribution models for consumers, they also ended up acting as cutthroat middlemen between transactions.
Cab drivers on Uber frequently face cash crunches and, leading them to resort to undesirable practices like ride cancellations or poor behavior towards customers.
Namma Yatri is an open mobility project directly addressing this issue gaining considerable traction with more than 2.5 million rides and 1 million registered users.
Gig workers on Swiggy and Zomato face hunger games like working conditions as described in an descriptive account by @deliverybhoy on Twitter.
The introduction of the Open Network for Digital Commerce (ONDC) is expected to rectify the demand distribution equation for offline and unorganized operators across shared mobility, logistics and e-commerce. By implementing this solution, it is hoped that there is more power restored to the operators rather than middlemen on revenue sharing.
This move for decentralization is one of the antidotes the system needs. But we believe for meaningful change, independent operators and SMBs have to be empowered through better tools to increase operator efficiency and the quality of their deliverables. Decentralization transfers a significant stake to the SMB in this value chain. However, without having the necessary tools at their disposal to deliver consistent quality at a scalable quantity, it may not be viable.
SMB tech can be categorized as follows:
Vertical Tools: designed for a specific industry with a number of closed use case functions. For ex: Shopmonkey for automotive repair and service center SaaS, Truck Smarter and Fleetio for truck logistics centered fuel card and fleet management tools. (Find more on our database).
Horizontal Tools: designed for a broad application across industries in specific functions like accounting, CRM, marketing etc. For ex: Frappe Books for accounting, meant for SMBs and Freelancers.
This is our first edition of open source ideas that can be utilized to address (in a similar way!) common problems that can be turned into startups or open source projects. We believe that these are the type of solutions independent operators in the mobility space need to help them grow sustainably and upskill.
SMB tech has generally had a tough time4 with traction due to low technology adoption, fragmentation, and small average contract values (ACVs), leaving open a large greenfield market for tech-enabled solutions.
We think that technology adoption (Aadhar, UPI, WhatsApp) and internet penetration accelerated by COVID-19 in India makes this solution viable.
This solution would help independent operators with an account management and fleet management tool helping them track financial and vehicle performance / health. Married with a fintech component to address liquidity challenges faced by operators.
Fleet Management Component: would address fuel, service and issue tracking.
Accounting System: would be used to build ledger for the operator to understand financial health, expense and income flows.
Account Aggregator: utilized to collect bank transactions, investment and credit information that will be populated on ledger.
Chat Bot system: utilized as the primary interaction system to log entries, supplement an entry that might require additional information from user or to get help.
Ride Sharing Platform: in this example we propose the ride sharing partners as a pilot group, whose transactional data can be used to understand driver performance and conversion rates against demand on the platform.
Fintech Component: The final utility of this platform would be to provide three forms of access to credit or liquidity based on a combination of all listed components of the system. Microcredit (for fuel or vehicle related expenses), Crowdfunding (for home and health related emergency expenses that cannot be met by microcredit), Friends & Family Chit funds as an alternative to formal credit (check chitfunds101 by d91).
Such a system has the ability to make direct impact on the quality of the nation’s commercial mobility operators. We believe the system can be iterated to build better driving habits, automotive safety outcomes, fuel savings and more. SMBtech is progressing to new levels in developed markets like the USA, which is why we decided to take note from Signature Block to write this post. Take a look at the Signature Block’s SMBtech thesis and directory to learn more.
If you think this is a viable idea and are interested in building it, feel free to email, comment or reach out to Joel.
Mobility Pages has an extensive list of tools meant for stakeholders operating in the mobility space. Find them below.
Ride-hailing & Taxi - India | Statista Market Forecast. (n.d.). Statista. https://www.statista.com/outlook/mmo/shared-mobility/shared-rides/ride-hailing-taxi/india
Third Party Logistics (3PL) - India | Market Forecast. (n.d.). Statista. https://www.statista.com/outlook/mmo/third-party-logistics-3pl/india
Annual PLFS Reports | Directorate General of Employment (DGE). (n.d.). Annual PLFS Reports | Directorate General of Employment (DGE). https://dge.gov.in/dge/reference-publication-reports-annual
Sarkar, G. (2022, July 1). Intuit QuickBooks’ India Exit Shows The Challenges In Making For India’s SMEs. Inc42 Media. Retrieved June 2, 2023, from https://inc42.com/buzz/intuits-shutting-down-quickbooks-offer-opportunities-to-startups-like-zoho/