Nishith Rastogi and Geet Garg, the founders of Locus, were working on a safety app for women, which they called RideSafe. The app could detect deviation of a vehicle from the route and raise an alarm. Restaurants and food-tech companies learnt about the app and started using it to track delivery boys. A big business was in the offing.
The two realised that Indian logistics and delivery were old world and there was no way to track packages and people. This meant lack of planning. And without planning, there couldn't be optimisation of operations.
In 2015, Locus started with the idea of optimising last-mile operations - the package delivery - using automation, but quickly moved on to other areas such as automatic sorting and packing and salesforce optimisation. The company's algorithms started advising customers on optimum capacity management - of people, vehicles and time. For instance, an e-commerce company might have 1,000 shipments to make on a day from its warehouse. The packages have different shapes and sizes. So, Locus tells the company the number of delivery executives needed for the day, the number of vehicles required to accommodate the packets and if the staff needs to work overtime.
The sales fleet optimisation product (Locus FieldPro) ensures higher productivity of the sales team and is being used by some fast moving consumer goods companies. The system captures the salesperson's skill sets, experience and the volume of sales he usually manages and suggests which store he should be sent to and at what frequency. "This is a different space from delivery or package movement. But there is a lot of traction here," says Garg. But how does the start-up manage all this?
Very early, the company invested in techniques that help in decision making using data. This is also the company's biggest differentiator. Locus competes with companies such as LogiNext and FarEye.
"All other companies tell you where your truck is; we tell you where your truck should be," says Garg. "We have decision-making tools based on data. Our decision is the USP."
Investors agree with this differentiation and point to others. The company has raised about $5 million from a host of investors, including V. Balakrishnan, Founder, Partner and Chairman of Exnity Venture, and Manish Singhal, Founding Partner, pi Ventures.
"Locus caters to the entire value chain from route optimisation to last-mile connectivity. Another interesting feature is their geo-coding engine," says Balakrishnan. "In India, most addresses are incomplete. For instance, people write that their house is near hospital. They have built a geo-coding engine which, with good accuracy, can direct the delivery guy to the right location irrespective of how the address is written. That is a big differentiator."
Of course, investors like the market size. India's logistics industry is about $300 billion. Locus' customers include both old and new economy companies - Blue Dart, Unilever, BigBasket, Myntra, among others. According to data with the Ministry of Corporate Affairs, Locus generated revenues of over `10 crore in year ended 2016/17, over 900 per cent growth from the previous year.
All this is probably a result of good outcomes logistics companies have seen. Some e-commerce companies, says Locus, have been able to reduce operational costs by as much as 25 per cent by just using the route planning software.