Vineet Agarwal, Managing Director, Transport Corporation of India (TCI), is bullish on online as well offline sales arises during the festive season. “The off-take is 15-25 percent higher than the previous festive season,” he said. Vineet Agarwal also spoke about the inflationary pressures and impact of rising fuel costs on freight charges, in an interview with Tanya Krishna of FinancialExpress.com. However, he maintained that this will not affect the consumer demand drastically. “We’ve not seen too much of an impact on the economy, because due to the post-Covid pent-up demand, people have been wanting to buy products. We do expect the upcoming festive season to be decent as well. So, overall, the inflationary impact is there, but not too significant yet,” he said. Here are edited excerpts from the interview.
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What kind of arise or rise in orders do you expect this festive season? What percentage of annual sales come from the festive season, generally?
During the festival season, typically stocking starts much earlier and logistics companies see a steady increase in volumes from August onwards. Business volume in Q2 is typically 20-25 percent higher than in Quarter 1.
Do you plan to hire more manpower to facilitate a probable surge during the festive season?
We see a rise in our hiring by about 20-25 per cent over the last year to meet the surge in demand during the festive season. The hiring is for temporary associates and other permanent staff for future requirements.
Are you looking at capacity expansion, in terms of warehousing, etc.?
Capacity, resource allocation and utilization will go up by 20-25 percent during the upcoming festive season, at TCI.
Which regions/areas are planned to get more orders?
Consumption trends are of course higher in the major and mini meters. However, we do see it arise in many other towns and cities.
In terms of categories, which products get more orders for delivery?
Other than consumer goods, there is also an increase in B2B deliveries as companies prepare for the busy next quarters.
Has there been a rise in freight costs due to increase in fuel costs and other factors?
Inflation impacts directly in the form of the cost of fuel. Because fuel is the largest single input cost for the logistics sector. In many cases, we are able to pass it on to our consumers. Overall, the inflationary environment does start to have an impact on demand. If prices are going up, then people might say, I want to defer the purchase that I’m trying to do. So, that can have an impact on demand. We’ve not seen too much of that yet in the economy. Of course, for specific products, you will see things going up and down. But otherwise, not too much.