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Gati Limited At the Threshold of a Big Leap

Gati Limited At the Threshold of a Big Leap

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Leaders in express cargo movement Pioneer in distribution and supply chain management Point to point transportation to complex end to end transportation. Supply chain management Cost efficient and flexible
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Services provided

Services are

Operates in three types of business segment viz.

Logistics 70

Vision

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Be the leader in Asia-Pacific and a globally provider of India-centric supply chain services and solutions. Delight the customers with quality services by setting new trends through innovation and technology. Be a responsible corporate citizen with unwavering commitment to environmental protection and conservation.

Core Values

To be ethical, integrated and transparent in our leadership. To respect and treat with value the enquiries of others. To be caring and abundant in giving support and services to others. To balance the body and mind, and `people serve people in good 33 spirit. To approach life holistically and elegantly with sympathy.

Infrastructure

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Vast network of office and franchisees

5 Zonal Offices, 61 Express Centers, 109 Depots, 160 Franchisees, 54 Customer Convenience Centers, 20 Surface Transit Centers, 19 Air Transit Centers, 5 Rail Transit Centres, 3827 extra service stations and 27 modern warehouses, spread across 580 out of 590 districts in the country.

GATI spread across 427 locations in India and overseas offices in Sri Lanka, Nepal, Hong Kong, Singapore and China.

The company also owns 30 containerized HCVs, refrigerated vehicles and 44 tractor-tow-head which provided the cutting edge to the business.

Technology

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Gatti website was inaugurated in 2002. Online tracking and lodging complaints . This provide high level of customer satisfaction through reverse flow of information through the Website, e-mail, SMS and toll free number. Gati.Net, to enable employees to share information and communicate

GATI implemented web based ERP called gati@web, comprising GEMS (Gati Enterprise Management 55 System), a custom-developed application, This is completely a centralized and on-line application.

Human Resources:

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The company has a strength of more than 2000 trained manpower that is committed to the growth of the organization. The training continues to be the thrust area of HR.

Promotion Policy was revised- branded Talent for Tomorrow-which diagnose the cos operational dynamics & enable high performers to get on fast track growth route

For training: co-opted consultants from NIIT,FCCI,AIMA,ICFAI,XLRI,etc

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Operations

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GATI is an ISO 9001:2000 company, certified for design, marketing and providing cargo management services and logistic solutions In collaboration with Indian Airlines, Gati launched GATI Gold and GATI Silver services, for speedy air-delivery of time-sensitive consignments at several major airports in India. It offered value added services such as flexible delivery options, door pick up and delivery, online tracking, toll-free call number. It planned to acquire modernized, customized to re-engineer and revamp its network to international standards. GATI is certified by IATA (International Air Transport Association) to promote, service, market and handle international air cargo movement.

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MARKETING

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Gatis simple approach was to attract new customers & retain old ones. Foundation of any successful business is only as strong as degree of customers satisfaction,

Business is about people. Stakeholders are financial mechanism that makes a companys Business happen. Customers, as a user of companys services, are its paymasters. Competitors need to be respected, as they spur a company to excel & work on innovative & creative ideas. A companys vendors are its supporters, & should, therefore, be made to belong to the organization. The companys employees, being service providers, make its customers happy by caring for them & Responding to their various needs. As it is people who drive all the operations of GATI, it is important for everyone to work with the motto people service people in mind.

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GATI as the Logistic Leader in the market.

Transformed its warehouses to modern express distribution centers. Gati @ web was launched for faster & smoother communication.

They revolutionized cargo sector By

On time intact, else money back. Custom designed product specific containers. Flexible pickup / delivery. Vehicle tracking system Customer complaint monitoring system Cash on delivery Track n Trace facility ( to keep a tab on consignments)

99 Gati was the first Indian Company to introduce toll free no (1600-425-4284)

ALPHONSO MANGO placing the order through phone or through companys website

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Gati was the first Indian logistics company to implement e-CRM (electronic Customer Relationship Management) by launching Customer call center that reduced complaints resolution time.

e-POD was another one of the firsts by GATI that facilitated scanned images of the consignment to be viewed on the companys website.

Gati was the unanimous & the most obvious choice for the BEST DOMESTIC LOGISTIC COMPANY award that it won in 2004 .

by launch of direct service between Chennai & Yangon (Myanmar). 14 days as against 35-45 days. 10 10

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June2005- setup an office at Beijing. During 2005- redefined logistics by setting up Express Distribution Centers (EDCs)

Gati was the only express distribution supply chain company that offered comprehensive multi modal (air, sea, land & rail) transportation services as well as third party logistics, trucking & warehousing solutions. Adopting an anticipate & prevent approach the RMG (risk management group) at GATI proactively curtailed losses & maximized opportunities & covered areas of vigilance, internal audit, insurance / claim management & legal compliance. The brand GATI was built over a period of years by vigorous involvement in the media, exhibitions & other promotional activities on the warehousing front. 11 11

INDUSTRY SCENARIO

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Express Industry. The consignments held by the express companies were broadly classified into :

Documents Any material comprising paper such as correspondence, bill / invoice, brochure, catalogue, books, files, account details etc. Non Documents Items with or without commercial value like CKD units, small machineries, electronic parts, spare parts etc.

On overall basis, documents accounted 60% of total revenue & the rest 40% was non documents. The express industry saw progressive growth in the last decade of 20th century due to trade & services. The elimination of trade barriers, globalization of markets & trade led to expansion in business 12 12

The express market is estimated at a total revenue of Rs. 2493 crore. The share of Domestic market is 59% & International Market is 41%

Sector
Organized Semi Organized & Unorganized EMS Speed post Total

Revenue(Rs. In crore)
1628 618 247 2493

Market share (%)

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ORGANIZED SECTOR

Solutions like Just in Time & e-Commerce enabled considerable business opportunity for web enabled services. The organized sector which was principally in the package segment of Cargo management illustrated high growth.

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Unorganized / semi organized sector faced pressure because of unfavorable pricing environment. The organized sector was by and large into documents business. The margins were much lower than package segment & also barriers to entry were also very less. Entry barriers in the Package segment were high because company needed strong distribution network, latest technology, well trained staff, strong brand image & economies of scale.
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Logistics management emerged as a new growth opportunity for

OTHER MAJOR PLAYERS

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The competitive advantage was that they had an air service, the only one of its kind in the country, which was focused on carriage of packages as its prime business, rather than as a by-product of a passenger airline.
DTDC was one of the leading Air Express & Cargo companies in India. It has expanded its delivery network to create the nations Largest Domestic Delivery Network The objective of the company was of developing multi-modal logistics support for India's international and domestic containerized cargo and trade It also had advantage of dedicated network of terminals across the country to capture traffic at the production/consumption centres.

DTDC COURIERS & CARGO LTD. (DTDC)

CONCOR (Container Corporation of India Ltd.):

EMS Speed Post: Post and Telegraph department in India which operated in association with other member countries of Universal Postal Union

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Semi Organized Sector:

Operating within a limited geographical area ( between states or between specific sectors like Ahmedabad-Mumbai,Delhi-Jaipur etc) .

There were few local companies who book consignments bound for any domestic locations. Such companies did not have their own distribution network and relied on the network of other similar companies in various locations or acted as wholesalers to organized sector companies. The semi-organized sectors matched the reach of organized sector service providers. The semi-organized and unorganized players operated on price advantages. Unorganized and semi-organized players were mainly characterized by high volume business.

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Un-Organized Sector:

of the express industry comprised companies, which had restricted operations within the boundaries of a particular city (intra-city couriers). Almost the entire market for intra-city business was accounted for by documents. The unorganized sector thrived on price and was unable to keep pace with the market in terms of reliability and timeliness. A scenario wherein unorganized sector would not exit at national level due to its inability to keep pace with the technology and customer demand was anticipated.

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Products and Services of the Express Industry

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Products:

Express (Document and non-document) :- this was the basic product of all express service providers. The delivery time was time bounded and was assured depending upon the distance between pick up and delivery locations. Door to Door (by air and surface) :- under this product, companies offered an option selection of mode of transport (if the customer did not specify the mode of transport, the consignment were transported by air. In case of heavy consignments or destinations on the trunk route surface mode was used.). 18 18 Door to airport and airport to door :- Under these products the

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S.W.O.T. ANALYSIS
Strengths:

Dominant player in the surface cargo segment in India, which accounts for more than 55% of the total. Niche value additions such as third-party logistics,trucking nd warehousing solutions.

Re-engineered hi-tech warehouses and distributing infrastrucure Advanced IT solutions to back up its services. It provides multi modal connectivity.

Weakness:

Insufficient regional and global presence as compared with its competitors. It has been neglecting courier segment

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Opportunity:

Expanding economy...WTO agreements Improvement in the logistics infrastructure in the country-better roads, improved ports etc.. Entry of a large no. of global retailers Increasing investments, booming manufacturing and development of organized retail sectors-provides business potentials to express industries

Threats:

Global competitors Direct competition from unorganized sectors.. Space limitations 20 20

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Emerging Challenges

Space is a perishable item, availability of space is the foremost challenge faced by industry. competition from unorganized sector player fight for lower profit margin industry depend upon domestic and international trade growth with the help of Liberalization of Indian economy and integration of international trade.

Direct

Express

Sustained

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Conclusion
GATI must develop Relationship Retailing for development of Retail Business Which will help the company

To establish and maintain long-term bonds with customers, rather than act as if each sales transaction is a completely new encounter.

Though Gati is a dominant player in the surface cargo segment in India, it still needs radical rethinking because

Its now facing global competition Needs to improve its networking as its competitors are much ahead of it 22 More international tie ups to become global 22