It’s an innovation that could revolutionise the trillion-dollar international logistics industry, and at its helm are two men from Chennai whose start-up, FreightBro, is making rapid strides in freight digitisation.

In a nutshell, what FreightBro does is simple. “Let’s say you are a freight forwarder, and you have a customer based in Tirupur who wants to ship goods to Germany,” explains Mohammed Zakkiria, the company’s co-founder, “The whole process starts from procurement, which takes 24 to 48 hours as it compares shipping options and schedules. Once the shipment is confirmed, customs formalities and physical movement of these goods require a manual process that is still carried out through emails and excel sheets, totaling to over 70 documents for every shipment. That’s where we come into the picture.”

FreightBro’s USP is its objective to automate this entire process by enabling the middleman freight-forwarder, but digitising the process — from procurement to delivery. “We want to be a Shopify in the freight-forwarding industry, where we hope to convert an asset-light freight-forwarder into a digital store of their own,” says Raghavendran Viswanathan, Co-Founder and CEO, FreightBro, “This means we get to use existing resources and infrastructure, and just give them a digital twist, and in turn reduce logistics costs.”

Since being incorporated in 2016 and being in operation for 18 months now, FreightBro has done business upwards of 10,000 TEUs (Twenty-foot Equivalent Unit — an approximate measure for a single cargo container) and is registering a growth rate of 100% with every passing quarter. To set things in context, the Indian cargo market accounts for 17 million TEUs, annually. FreightBro wants a small piece of the pie. “Whatever we have automated so far, 10,000 TEUs, is a small percentage. We want to increase that to one percent of the whole market,” says Mohammed. “If we grow at the same pace for 24 months, we will end up capturing this one percent,” adds Raghavendran.

The company operates on two models, depending on the size of the freight forwarder it is servicing. “We don’t go with the one-size-fits-all approach,” says Raghadevandran, “For bigger freight forwarders, we work on a subscription model, where we charge them per-user, while we work on a pay-per-use model while doing business with our smaller freight-forwarders.”

FreightBro’s attempts at turning the logistics and cargo business into a digital store has taken form and shape at its offices in Chennai and Mumbai, which the company says accounts for 70 percent of cargo traffic to and from India. While Raghav has moved base to Mumbai, Mohammed continues holding one end up at FreightBro’s home in Chennai. The company is 70 employees strong and wants to expand presence to hinterland markets like the Tughlakabad Container Depot.

“As long as we have 5,000 freight forwarders in India using the FreightBro platform and providing quotes customers in less than two minutes, the whole business of waiting for quotes and shipments is fixed,” says Raghavendran, “That’s what we are striving towards — empowering at least 5,000 freight forwarders in India.” But true to his tag as a millennial start-up founder, Raghav’s vision is a bit more ambitious: international expansion, provided the company gets its unit-economics right.

“We are also looking at markets similar to India — English-speaking markets that work in a similar fashion to those in South East Asia, where our small-and-mid-sized freight-forwarding model could work,” says Raghavendran, “For our subscription model, we are thinking beyond, and looking at mature markets like the United States and Europe.”

While FreightBro was bootstrapped for the first year, the company has raised a couple of rounds of funding, subsequently. Even as it works around its per-shipment costs and profitability, it is contemplating its next round of funding, which the founders say will go into more investments in technology and expansion. “The funding that we are thinking of raising is going to be for expansion, and setting up a global brand so that we won’t restrict ourselves to India,” says Raghavendran. “We have a couple rounds of talks going on, and hopefully, everything should fall in place.”

Published On : 27-11-2019

Source : CNBC TV 18