Taal music premier webcast live by Rediff
The DQ Week Delhi, (DQW News Bureau), June 17-23, 1999

You want to buy your overseas nephew a Daler Mehndi CD or a cricket bat? Don't look for your car keys, switch on your computer instead. It's cheaper to buy them on Rediff On The Net's virtual store on the Internet. They also ship it for you cheaper than FedEx would. And to top it all, they guarantee that it will reach in 72 hours. This in a country where you are not sure whether customs will clear goods in a week or three!

How do they do this? Their promises are backed by FedEx.

Logistics is a critical brick for building a virtual store. This is a business where a customer pays for wares that he hasn't set eyes on, so credibility is everything. An irate customer does not spread his ire word-of-mouth, he sends out e-mail to a list which in turn could get redirected to yet another list; this could result in exponential bad publicity in a matter of hours.

How does FedEx make the whole game more credible? "Well, they are synonymous with e-commerce," says Uma Iyer, director, strategic alliances at Rediff. The equation for the Memphis-based $13.5 billion shipper is simple. More e-commerce means more goods to be delivered. So it has invested a huge amount in software and other expertise to enable companies to swiftly embark into e-commerce. Dell Computer's famous model of assembling a computer after a customer orders it and yet delivering it in 24 hours is enabled by FedEx.

The shipper decided to get into the e-commerce act in India under a year ago. "We want to give our consumers a world-class online experience. Fedex is the best in e-commerce logistics," says Ajit Balakrishnan, CEO of Rediff. FedEx also decided to make Rediff its showcase project so that it has a case study in the country and also to set up procedures here. "An e-commerce partner can't be a shipper. We are strategic partners," points out Sidharth Tripathy, marketing specialist at FedEx. "It is in our interests to make sure that our partner's e-commerce venture is a success."



FedEx operates a fleet of 625 aircraft and can deliver to several destinations in 210 countries. So they can automatically help even a small exporter here in India export to any of these countries. In Rediff's case, all that a customer has to do is to get into Rediff's website and order any music CD. He, of course, pays up immediately for the goods ordered with his credit card. Rhythm House, one of the suppliers, is connected to Rediff electronically and also knows FedEx's cutoff time for pickup. They download orders from the Rediff site and pack the stuff in boxes supplied by FedEx. "It is our responsibility to deliver the contents of the boxes safely. So our packing centre designs boxes for shippers. For instance, one exporter in India now wants to export stone slabs and we will work with him," says Tripathy.

Then the supplier generates an air-way bill through software installed free of cost by FedEx customer automation experts. The bill has details on where the package has to be sent and from where it is being sent and so on. The packet being shipped will have a unique airway bill number across the world besides being in a barcode format. The supplier then calls the FedEx call centre to ask for a pickup. All calls to the call centre are reecorded in an global computer system.

The pickup man scans the barcode on the packet. The packet's details get into the international computer system immediately. The airway bill number is e-mailed to the customer who placed the orders on Rediff's site. "For a customer who has paid for these goods, there is no proof more credible than our airway bill. He can key in this number in the tracking software on our website and he will know the status of his shipment," explains Tripathy. This is because all FedEx shipments get scanned at every stop they make across the world. The software at the supplier's site also generates reports on shipments for him. FedEx also has software that produces additional documentation required like proof of delivery (POD) and invoice so that they can bill Rediff. Rediff has 25-odd suppliers in Mumbai, Bangalore and Delhi and FedEx has worked with all of them. "So there is no warehouse, no inventory or locked up working capital," says Tripathy.

The FedEx software also generates all documents required by customs authorities across the world. Customs consultancy is a major part of the shipper's business. "We have an expert who is available on a cellophane 24 hours for our customers to consult about customs in any country in the world. He consults on documentation. He also works with companies in advance on regulations," claims Tripathy. If all papers are in order, FedEx also guarantees quick clearance at Indian customs. When the package is delivered, FedEx keeps tabs on who picked it up at the other end by its international computer system.

The shipper is also a partner in all the promotions that Rediff comes up with. For example, Rediff had undertaken a promotion to launch Shobha De's book which was being published by Penguin. So FedEx was told that De has a huge following overseas. The two partners then worked together to predict the increase in shipments and FedEx geared up.

Rediff is soon going to launch a scheme where it will allow others to host their own stores in their mall. FedEx then will also work with these stores. So if you are mulling over retirement plans, turn to pottery or furniture making or whatever you are deft at and put it up in an e-store and you have a giant distribution system to take care of the rest.