Logistics solutions provider Ecom Express to add 40,000 workers in view of festival demand 

Logistics solutions provider Ecom Express is gearing up for the upcoming festival season by planning to onboard approximately 40,000 workers, of whom the majority would be hired on a contractual basis, according to a top company executive.

The Gurugram-based company, which generated a topline of ₹2,124 crore in FY22, currently maintains a total workforce of 50,000 individuals, of whom around 18,000-20,000 are permanent employees. “We are aiming to onboard 40,000 delivery partners and associates for the upcoming season to cater to the surge in demand,” K Satyanarayana, co-founder and director, told businessline.

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Discussing the industry’s workforce expansion, he said compared to the previous year’s growth of 2.3 to 2.4 times, this year has seen a more modest increase of about 1.8 times in terms of manpower additions.

During the Covid period, the industry grew at a compound annual growth rate (CAGR) of approximately 35–40 per cent, whereas currently, it is experiencing a growth rate of 15-20 per cent CAGR.

Higher revenue

Although the company is yet to file its FY23 financials, Ecom Express anticipates 20–25 per cent revenue growth, higher than the industry growth of 15-20 per cent, noted Satyanarayana.

Speaking about the company’s profitability, he said, “For the past four years, from FY18 to FY22, we have consistently maintained profitability at the EBITDA level. In fact, in FY22, we nearly reached breakeven, and we expect a similar performance in FY23.”

Although EBITDA remains the primary focus for the company, its initial decision-making criteria for any top-line growth initiatives involve an examination of unit economics and a commitment to achieving positive results in that business segment with a path to profitability.

• Also Read: Ecom Express scout for partners in Kerala

The company operates three lines of business: Ecom Express Services, Ecom Fulfilment Services, and Ecom Digital Services. It is confident of organic and inorganic growth in the domestic market.

“We anticipate having 350 million online shoppers by 2027. If we aim to double the size of the online retail sector, it’s crucial to strategically engage with the Indian market through both organic and inorganic means. In this context, we remain open to exploring available capabilities,” he said. In 2021, the company expanded to Bangladesh via an investment in the third-party e-commerce logistics (3PL) firm, Paperfly.

The logistics solutions provider currently manages 9.6 million sq ft of real estate which includes hubs, processing centers, delivery centers, and fulfillment centers. It has a network of over 60 facilities and operates 31 automated sortation centers, extending its presence to over 30 cities.

While there are no immediate plans to invest in building capabilities, “in the last couple of years we invested close to ₹500 crore in terms of building capabilities, and we will look at more investment in the middle of next year,” he added.