In the maritime industry, to make any purchase requires seeking approval from the shipping company’s office, using complicated software to place orders, and still not being sure of the quality of the product. Hence, to streamline the complex process, logistics-focused technology is becoming increasingly important.
Realising the need for this while at the sea, batchmates from Applied Research International, Dhruv Sawhney (34) and Vivek Sahi (35) joined hands with former-lawyer and friend Sunny Bagla to start ShipsKart in 2018.
Delhi-based ShipsKart is a B2B ecommerce marketplace for all maritime solutions.
“We wanted to build an Amazon-like marketplace for the maritime industry,” says Dhruv.
The startup aims to revolutionise the fragmented procurement and supply chain in the maritime and offshore domain. The startup currently has offices in Delhi and Rotterdam, the Netherlands, and plans to soon start its first aggregator centre in Mumbai.
“We intend to improve the speed, timeliness, efficiency, and quality of procurement process,” Dhruv adds.
In 2018, ShipsKart was selected by PortXL (partners of Port of Rotterdam, Ernst & Young, Shell), as one of the most innovative startups. PortXL also invested €100,000 in ShipsKart BV, their Rotterdam subsidiary.
Team of seafarers
Dhruv has 14 years of experience at the sea, and has previously worked with companies like Maersk Tankers and Bourbon Offshore. Before starting ShipsKart, Dhruv worked as the First Officer in a French oil and gas company for seven years.
Dhruv was struck by the idea for ShipsKart when his friend Vivek Kapoor (Co-founder of Dineout), who is also a former seafarer, once mentioned the idea of a marketplace for the marine industry.
“I booked the domain – www.shipskart.com, knowing that sooner or later, I would be working on this,” says Dhruv.
Dhruv later approached his friends Vivek and Sunny with the idea. The trio incorporated the company in February 2017 but started operations only in March 2018.
Dhruv is also the cofounder of another company called Dee Vee Shipmanagement, and currently looks after the business development of the startup.
With over 12 years experience in the main fleet and offshore as a management-level officer, Vivek currently handles all the operations of the startup.
Sunny, on the other hand, has over nine years of experience in the financial and legal field. He has previously headed the taxation department of a corporate. Sunny now takes care of the finances and operations.
Today, ShipsKart’s team strength is 12, which includes industry veterans.
Click at sea, deliver at shore
ShipsKart lists spare parts, provisions (food), and consumable store (consisting medicines, cleaning material, stationary, navigation, and engine products) on its platform.
Vendors can place orders for products on its Android or iOS application, or on its website as well.
“Ease and convenience are the two highlights of ShipsKart. We aim to bring vendors and vessels together,” Dhruv says.
The startup ties up with vendors from across the globe and on boards them on the platform. The vendors can then list and update the prices on the application, whenever there is an alteration in the rates.
ShipsKart has currently tied up with 100 vendors across 20 countries.
“We connect with ship owners, managers, and captains,and help them understand the benefits and signing agreements with these companies using our tech platform,” says Dhruv.
The startup has also added features like reverse auction process as part of its latest update.
Revenue model and challenges
ShipsKart mostly targets ship owners, managers, ports, shipyards and the oil and gas industry – rigs and platforms.
For this, the startup works on two revenue models – the marketplace and the subscription model.
“As we grow, we will have to charge advertisers on our platform as well,” says Dhruv.
While the marketplace is free to use, ShipsKart charges a commission of five to eight percent from the vendors on the total order value.
With its marketplace model, ShipsKart also lets companies take a break from managing the procurement.
“They don’t have to deal with multiple vendors across geographies, and thus reduce man hours. This is a huge saving for the company,” Dhruv says.
However, the startup had its own set of challenges. Since none of the co-founders were from the tech industry, initially they had to outsource the technology. In order to overcome this, they have partnered with T9Labs, starting April 2019, as their tech co-founders. “That’s why there has been a drastic increase in our numbers,” says Dhruv.
The maritime industry
According to the Economic Survey 2017-18, the Indian logistics market is expected to reach about $215 billion by 2020, growing at a CAGR of 10.5 percent.
ShipsKart competes with traditional shipping companies, and with ship suppliers and agents. “They are nothing but middlemen in the supply chain, and have a manual process of working,” says Dhruv.
Other global players in the space include companies like ShipServ and Moscord. While ShipServ is more of a marine directory of ship suppliers across the world, Moscord is a bulk-buying platform.
“We are the only platform to have the ship, the company, and the vendor on a single platform. Moreover, while using our platform, ship owners don’t have to connect with various suppliers across geographies,” Dhruv claims.
The number game
Initially bootstrapped with Rs 75 lakh with help from colleagues and friends, ShipsKart is now actively looking to raise funds. “We are in touch with a few probable investors and should have something closed in the next few months,” Dhruv says.
The startup recorded a total revenue of Rs 1.3 crore in their first financial year. “The majority of this amount came in the last five to six months of FY 2018-19,” says Dhruv.
Furthermore, their operational profit was 10 percent, and this year they are hoping to maintain their operational profit at around eight percent.
“We should break even after the completion of our third financial year,” Dhruv says.
The startup has generated Rs 50 lakh each month this year, and in July it is expecting Rs 1 crore in revenue.
“We are on course to finish this financial year with at least Rs 10 to 12 crore of total revenue,” he adds.
(Edited by Megha Reddy)