The penetration of the Internet, the proliferation of smart devices, and the advent of advanced technologies have redefined businesses and led to the emergence of the doorstep delivery model that has reimagined customer experience.
Today, almost every item can be ordered at one click- apparel, groceries, books and stationery, and even fuel. The Covid-19 pandemic has further accelerated digitisation and provided a fillip to e-commerce amid travel restrictions. The trend is foreseen to continue into the post-Covid era due to policy thrust by the government, initiatives by businesses and harnessing of cutting-edge technologies.
Diesel is the most widely used petroleum product in India and accounts for 40% of total fuel use across sectors, including business houses and IT parks, real estate, transportation, agriculture, manufacturing, mining, and many more.It is heartening to witness the emergence of several startups in this segment that are disrupting traditional distribution models. Doorstep delivery of diesel via online mode allows access to fuel at a convenient location, reduces transportation costs, and provides timely and hassle-free delivery. Doorstep delivery of diesel has emerged as a panacea during the lockdown as it enabled numerous businesses to sustain the momentum.
Doorstep delivery of diesel has led to the emergence of the ‘FuelEnt’, a flagship initiative by the government of India, intended to build a strong ecosystem for entrepreneurs looking to drive sustainable growth. It saves them from the time and hassle of standing in long queues and traffic congestion. It also saves transportation costsand serves as a cost-effective medium for the delivery of goods. Affordability and convenience are the key hallmarks of doorstep delivery. FuelEnts are increasingly leveraging advanced technologies and models such as Artificial Intelligence and lean management to streamline the supply chain, reduce costs, improveefficiency, and enhance customer experience.
All the customers need to do is to book the order via a mobile app. Once the fuel delivery vehicle reaches the customer's venue within 24 hours, he indicates the desired quantity and gets safe delivery via an OTP. Special precautions are taken to minimize any chances of leakage or pilferage by using geo-fenced bowser-enabled vehicles. The startups in the fuel delivery segment are leveraging emerging technologies such as AI and the Internet of Things for real-time monitoring and tracking of orders and vehicles and reducing order fulfilment time. Moreover, contactless fuel delivery during the lockdown has proved to be a boon during this unprecedented time.
On the policy front, the recent FuelEnt policy aims to encourage startups to offer innovative business solutions. This policy authorizes eligible startups registered as 'DDD resellers' to resell HSD (High-Speed Diesel) to businesses after procuring them through Oil Marketing Companies (OMCs) or retail outlets.
The consumption of diesel in India stood at 72.72 million tonnes in fiscal 2020-2021.The Indian door-to-door delivery of fuel segment is estimated at 60 - 70 thousand litres a month per bowser. Oil marketing companies predict that the segment will be worth over INR 2000 crores in the near term of the next 12 to 18 months. Moreover, data from the Petroleum Planning and Analysis Cell (PPAC) pegs the increase in demand for high-speed diesel from 27 crore litres in 2019 to 43 crore litres in the next decade that will put retail outlets under strain. It is here that FuelEnt will plug the demand-supply gap, contribute towards employment generation and drive sustainable outcomes for the Indian economy through the scalable model. Real estate, infrastructure and agriculture will emerge as the sunrise sectors in the doorstep fuel delivery segment.
The scaling up of FuelEnt solutions will unlock tremendous opportunities to foster innovation and redefine the customer experience. For instance, there is a scope of several mobile unit models for fuel delivery, such as a mobile app for doorstep delivery, mobile dispensing systems for refuelling earthmovers in construction sites, liquid measuring systems, dispensing and metering of edible oil and much more. FuelEnt can also choose to tap newer avenues such as converting waste into fuel that will mitigate carbon footprint besides augmenting a revenue stream for these businesses.
Nevertheless, certain challenges warrant extra precautions. The foremost among them is safety. Petroleum products are highly inflammable and are even highly prone to pilferage for black marketing. The Indian policy framework currently permits only diesel for doorstep delivery. Considering the nom-renewable nature of fuels, there is also a need for a comprehensive mechanism for predicting and mapping demand in real-time and monitoring smooth supply to priority sectors such as transportation and agriculture.
The doorstep delivery of fuel is a critical step to ensure equity in access to fuel- a basic necessity. As we advance, customisation, innovation and scalability will be the vital factors for determining the segment's growth trajectory in the long run.