India lockdown throws online delivery out of gear, millions cry
In an unprecedented crisis despite Prime Minister Narendra Modi assuring the continuation of essential services like food and groceries, online marketplaces like Flipkart and Amazon along with delivery platforms like Bigbasket, Grofers and FreshToHomes hit a major blockade on Wednesday as local authorities shut warehouses and sent delivery boys back, even harassed them.
 
Millions of people across cities were left helpless at homes as essential items like fruits and vegetables, dairy and milk, meat and fish etc did not reach their doors despite placing orders well in advance. Later, the orders went dry.
 
While Grofers' warehouse in Faridabad was closed by the local law enforcement agencies, Bigbasket complained that the police stopped its delivery partners and "some of them were even beaten up by for no fault of theirs".
 
"We are not operational due to restrictions imposed by local authorities on movement of goods in spite of clear guidelines provided by central authorities to enable essential services. We are working with the authorities to be back soon,' Bigbasket tweeted.
 
In a statement to IANS, Bigbasket said that it will help to have better coordination between the Centre and state, and between the state and local police to "ensure that our delivery vans and bikes don't get stopped by the police. Bigbasket and bb daily are not taking new orders".
 
Furious people stormed the social media platforms, writing their plight to NITI Aayog CEO Amitabh Kant on Twitter.
 
"Sir, all e-commerce are down. Believe me I tried everything (Grofers, Bigbasket, Flipkart, Amazon, Big Bazaar), no delivery till 31st March or Server Down or No Service. Need to think how we can enable them through digital India," tweeted one user.
 
Kant tweeted back to Bigbasket: "They should give me specifics - State & location. I will act on it by getting in touch with concerned authorities & sorting it out. Govt guidelines exempt them. We will ensure that citizens are not impacted".
 
Kant also responded to Grofers: "Cold storages & Warehouses as well as delivery of all essentials goods including food, pharma thru E-Commerce are exempted under MHA order. I have spoken to CS & DGP, Haryana . They have taken immediate action to ensure that supply chains efficiently function for the citizens".
 
The subscription-based hyperlocal delivery startup FreshToHome sent messages to its customers, saying that despite the government declaring food delivery as essential, "we are facing hardships in continuing our operations".
 
"Please bear with us as we are working hard to unblock local authority hurdles," said the FreshToHome team.
 
Reports later surfaced that the Department for Promotion of Industry and Internal Trade (DPIIT) has initiated talks with the state Chief Secretaries asking them not to restrict movement of people engaged in home delivery of essential items, mentioned in the list of exempted items circulated by the Home Ministry.
 
Meanwhile, Flipkart said it has temporarily suspended its operations and services - including grocery items. The marketplace has decided to halt all orders from March 25 for all three supply chains -- groceries, non-large goods and large items.
 
"Flipkart has temporarily suspended orders as we assess the possibilities of operating in the lockdown. We are prioritising the safety of our delivery executives and seeking the support of the local governments and police authorities to meet the needs of our customers as they stay home during this lockdown," Rajneesh Kumar, Chief Corporate Affairs Officer, Flipkart, said in a statement.
 
E-commerce giant Amazon said the company has to "temporarily stop taking orders and disable shipments for lower-priority products.
 
"For all pending customer orders on lower-priority products, we are reaching out to customers and giving them a choice to cancel their orders, and receive a refund for prepaid items," said the company.
 
Witnessing a surge in demand, supermarket chain Biz Bazaar entered the fray, with launching doorstep delivery services in major cities like Delhi, Mumbai, Bengaluru and Gurugram.
 
However, within no time, Big Bazaar was flooded with calls, forcing the company to issue a statement, saying that "In light of the recent announcement, we are receiving an unprecedented number of requests for doorstep delivery. There could be a delay due to the restrictions on movements".
 
Already battling massive surge in demand, the online delivery platforms faced other issues too, including zero access to several high-rises across the country which have gone under complete lockdown with all entry and exit gates locked.
 
Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
 
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    Domestic Hotels Staring at Major Disruption due to COVID-19: Ind-Ra
    Increasing intensity of the COVID-19 in India could meaningfully impact the operating metrics of hotels across segments and regions. Since the sector depends completely on the mobility of people, the outbreak possesses a direct impact on the business performance of this sector, says India Ratings and Research (Ind-Ra).  
     
    In a report, the ratings agency says, “Occupancy rates across hotel categories are likely to fall to their lowest levels in the last decade, materially impacting earnings. The industry in general would face challenges in debt servicing, especially for companies in the ramp-up mode, where a large portion of capex is funded by debt.”
     
    “Furthermore, this comes at a time when hotels typically enjoy peak season occupancy due to vacations and weddings before the onset of monsoons; hence, any disruption in operations would substantially impact the full-year operating performance of hotel companies,” the ratings agency added. 
     
    Ind-Ra estimates the occupancy of mid-scale and two-star hotels to fall to 30%-40% and that of four-star hotels and above categories to 20%-25% for the next three months beginning March-2020.
     
    The ratings agency sees sharp deterioration in occupancy rates in domestic hotels. It believes that the occupancy rates would have a multidimensional hit. 
     
    It says, “All the major drivers of occupancy rates could be impacted severely, as the movement of people gets limited due the government restrictions and self-precautionary measures taken by them. Considering a look-back analysis during the global financial crisis, the average absolute occupancy rates fell by over 9%. The highest fall of 10.40% was witnessed in the occupancy rates of four-star and above category hotels, followed by three-star ones at 8.5%, because they are mostly occupied by business travellers. These hotel categories have been impacted the most since business travel has shrunk largely post the global financial crisis, If we consider the global financial crisis as a benchmark, the magnitude and the impact on the drivers of occupancy rate due to COVID-19 is much larger than that during the post crisis period.”
     
    In its base case, estimates, Ind-Ra modelled the potential impact of COVID-19 on occupancy rates till first quarter (1Q) of FY2021 for different hotel categories. It says, “We assume a higher impact at end-4QFY20 and a modest recovery in the latter half of 1QFY21. We believe the occupancy rates of four-star and above category hotels to be impacted more than that of with three-star and mid-scale ones. This is because the revival in foreign tourist arrival could be stretched and depends heavily on the elimination of COVID-19. If on the other hand the spread in India gets contained in the next couple of months, the movement of people could see some traction and hence we might see some recovery in the mid-scale or three-scale hotels. However, if the intensity gathers pace, then occupancy rates could be significantly lower.” 
     
    Furthermore, Ind-Ra says, many south-east nations such as Singapore, Indonesia Hong Kong, where the outbreak started in January 2020 have witnessed a sharp decline in the occupancy rates. In some of these countries, occupancy rates fell to the levels lower than that was recorded during the SARS outbreak in 2003. The occupancy rate during the SARS crisis in China fell to sub 20% from around 70% within a three-month period. A similar situation in India cannot be ruled out, should the outbreak continue and containment remain limited.
     
    According to Ind-Ra, in the current scenario where travel restrictions are imposed and people voluntarily curb non-essential movement, there would not be any material change in the average room rate levels, as occupancy would be generated on essential need basis. Assuming the average room rate levels remains constant, the revenue per available room would deteriorate to the extent of change in occupancy levels, it added.
     
    “Considering Ind-Ra’s base case scenario over the next month, hotels under the four-star or above categories could witness around 65%-70% fall in the revenue per available room whereas the ratio for those under mid-scale and two-star categories could deteriorate between 50%-60%. Subsequent deterioration in credit metrics is likely,” the ratings agency concluded.
     
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    Brakes on automobile production as plants shut down
    India's second largest car maker Hyundai Motor India Ltd, two and three wheeler makers TVS Motor Company Ltd, Eicher Motors Ltd and Suzuki Motorcycle India Pvt Ltd have announced closure of their plants in order to contain the spread of coronavirus.
     
    In a statement Hyundai Motor India said it is suspending manufacturing operations near here from March 23 till further notice. "We will await further notifications from State Government to resume plant operations," the company said.
     
    The car maker has two plants near here with a capacity to roll out about seven lakh units per annum.
     
    Two and three wheeler maker TVS Motor in a regulatory filing said as an interim measure it has decided to shut operations at all its manufacturing facilities and offices for two days effective from Monday.
     
    "The Company would take further steps after reviewing the situation," the statement added.
     
    Similarly, Eicher Motors that rolls out Bullet and other motorcycles in a regulatory filing said it has decided to suspend all operations globally, starting Monday, March 23, 2020, till March 31, 2020.
     
    "This will include the company's manufacturing facilities across Tiruvottiyur, Oragadam and Vallam Vadagal in Chennai, Technical Centres across Chennai and at Bruntingthorpe, Leicestershire in the UK, and all company offices and company owned dealerships in India," Eicher Motors said.
     
    Eicher Motors has further issued advisories to all dealerships in India to shut down for the same time period, or follow local administrative orders, as may apply.
     
    "During this time period, company employees will continue to work-from-home, and there will be no salary deduction for any permanent or temporary employees or workforce, and no reduction of workforce," Eicher Motors said.
     
    Another two wheeler maker Suzuki Motorcycle India has said it has suspended production at its manufacturing plant at Kherki Dhaula, Gurugram till further notice.
     
    "This is in view of the precautionary measures taken in the wake of the COVID-19 (coronavirus) pandemic and in line with the Haryana Government directives in this regard," Suzuki Motorcycle said.
     
    While the Company has taken all measures to ensure the well-being of its employees at the workplace, we have announced a 'Work from Home' advisory to our employees and associates who are not involved with maintaining essential services,a Koichiro Hirao, Managing Director, Suzuki Motorcycle said.
     
    On Sunday India's largest car maker Maruti Suzuki India, Mahindra & Mahindra and Hero MotoCorp announced shutting down of their plants.
     
    Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
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