Logistics of the mattress industry needs to be improved

The mattress manufacturers have been considerate towards their retailers. Most of the manufacturers do not charge their retailers for the transportation charges they incur.

“We deal with Spring mattresses, foam mattresses rubberized coil mattresses. As we place an order with the manufacturer the order is dispatched from the manufacturing unit in Krishnagiri, Hosur Road. As they dispatch it to a point in Bangalore, we retailers get it to our outlet by hiring local transport. We also take up customized orders from customers. During such situations, we place an order with the manufacturer for this particular order placed by the customer. The company then plans a route to deliver the ordered mattress. For instance, if there are major orders coming from the South route of Bangalore, the ordered mattress is sent along with the other deliverables. The container delivering the South part of Bangalore will be delivering the consignment and we will be informed about it. We take a local auto and procure it. Other retailers also pick up their orders this way. This way the South Bangalore orders are finished in a day,” says a retailer of leading mattresses in Bangalore. 

Free transportation for Customers

On the other hand, retailers sometimes do charge the customers when they are not within the deliverable range. “The manufacturers send the consignment through vehicles either directly to the retailers or they give a certain customer point from where we can pick up. The choice is left to the retailers. We charge the customer for the transportation even if it is local and we charge it based on the price of the product. If the product is a high-end product (price range is high) we do not charge much; but on the other hand, if the product ordered is not highly-priced then we charge the customer according to the transportation price. If it is Bangalore, we send it through courier services like VRL and the customer has to pay for it once he receives the mattress,” says a retailer from Mysore “If we get an order from a remote place, the logistics charges will be levied to the customers. If it’s out of station then the logistics will be charged to the customer completely,” says a retailer of a branded company in Bangalore.

Vacuum-Packed Mattresses

Meanwhile, a leading mattress brand introduced vacuum-packed mattresses to eliminate the logistics challenges faced by the mattress manufacturing industries. Traditional mattresses are heavy and delivering them was a challenging task as the majority of the buildings do not have service elevators and carrying a mattress up a difficult task. When questioned about the retailers about vacuum-packed mattresses, they submitted that the factory that deals with manufacturing the mattress must be equipped with a facility that deals with vacuum-packing and not all stores or packing outlets can do that.

“Vacuum-packed mattresses are the trend now but there is only one brand available with us called Live-in mattress. It is a completely vacuum-packed mattress. It will be vacuum-packed in the factory itself. This definitely helps us in transporting to the customer but not all customers prefer this vacuum-packed mattress,” adds a retailer. “No shops can do vacuum-packing and we don’t house such vacuum-packing equipment either. We depend on the local autos for transportation and the autos charge on the number of mattresses. Transportation in the Mysore city is much easier due to the traffic compared to Bangalore,” says Dattatreya, a store manager in Mysore.

Imported furniture retailer’s story

Unlike local retailers, retailers that house imported mattresses face a different situation altogether. “We deal with an imported brand of furniture and mattresses. Hybrid mattresses, memory foam mattresses, and spring mattresses are a few of them housed. It is a brand from the US and the manufacturing units are in Vietnam and China for the Asian region. It is shipped from there in vacuum-packed condition. It comes in boxes and we send the same to the customers. But we are charged with shipping, credit containment charges and a lot of other charges which makes this a costly affair. Within Bangalore, we deliver for the customer free of cost but out of Bangalore, we charge for the transportation.

From Tata Ace to big containers, we have our own logistics but we do hire outside transport services sometimes. The customer is charged according to how many products the customer has ordered since we sell even furniture. The cot and mattress are usually ordered together. We have a warehouse in Rampura, Hennur where the manufacturer docks the mattresses. From warehouse to retail outlet, we use our vehicle to transport,” says Vivek Mani of an imported leading brand in Bangalore.

Small Scale Manufacturers and Logistics

Where retailers are charged with transportation charges, some of the small-scale mattress manufacturers are facing difficulties in transporting the mattresses since COVID.

“We are into manufacturing mattresses and into interior designing houses and offices with a small manufacturing unit in Jigani. We deal directly with the client without going through the conventional retailer-to-customer route. We undertake customized mattresses according to the needs of the client. We get the mattress done by local craftsmen according to the needs and deliver it through a local transport auto. The mattress variants available in the market are available with the same features but for a lesser rate,” says Panduranga of VWant Interiors.

According to a few small-scale manufacturing units, it was a challenging task during a pandemic to deliver mattresses to the customers but in responding to these difficult times, certain apps are introduced that are helping a big time in logistics.

“Prior to COVID, we hired a local auto to deliver our consignment. During times of COVID, sales sunk low as the transportation problem set in. We could not hire the local autos due to the lockdown but since a month back it has been picking up. The major problem with hiring local transport guys is the charges and the punctuality. There was an order from a customer and I had promised to send the mattress to her within 1 pm. I booked an auto at 10 am and he could not come on time. I tried calling the transport guy and he did not pick up my call either. I could not face the client as I had already taken an advance from her for the product. During my search for better and more organized transportation I came across a certain app that deals with logistics,” says Panduranga.

The app associates with various local transport guys and sends them on time to whoever books it. When one opens the app, the nearest transport vehicle available for delivery is visible to the customer and he can book the transport according to his needs. There are small autos to big containers.

“I would prefer this App as it is more organized and they charge less compared to the local transport guys. For instance, a consignment from Jigani to Whitefield cost me Rs.2500 earlier. But with the introduction of the App, they charge us Rs.1700 instead. This is an economical process,” adds Panduranga. Some manufacturers have the local transport guys as their last preference due to some of them being negligent in delivering the goods.

“Some of the regular transport people whom we approached come to us now complaining that they are not receiving the business from us regularly like earlier. We console them by giving them a few assignments in between. This makes them encouraged and work better. We even had plans of having our own transport vehicles instead of hiring every time. But it would not work out for us as we will not be able to promise an entire day job of delivering consignments. With this, we will not be able to pay them salaries for the amount of work they do. But a major disadvantage of the app is they do not have trained manpower to handle the mattress during transportation and delivery. We will have to send someone from our factory to handle to mattress” adds Mr Panduranga.

Logistics Companies and their working

Logistics Apps are slowly increasing and there is a need for such apps that help in delivering mattresses across the city or state as apps are more organized, efficient and professional in delivering and transporting. The local autos or transport can also associate themselves and make business in the process as the apps promise them a better earning at the end of the day. But in the process, the most affected are the logistics companies that take up transportation of the consignments.

“Cropping logistics apps are beneficial in a way to the company and vendors like us. I’m a vendor to Gati since 1992 with a small fleet of vehicles. Gati is a courier company and Gati books the material and transports from one place to another. We provide our vehicles to the company and few leading brands have been our clients. We operate mainly in South India. During COVID, our company was badly hit. If there is production there is demand for the logistics company. Everything was stopped for 4-5 months since lockdown. May be 20 percent of some of the productions were going on. Among them mattresses was one. The competition was fierce with less production and we did not receive much orders for transportation. Pro COVID, four of our vehicles were getting booked at once. At present, the bookings have come down drastically,” says BV Ramesh of Unnati Logistics. Apart from not receiving any business, there were other factors that affected them badly like the maintenance of the vehicles (as they were stranded in the depots), payment of EMIs even though there was no business, management of insurances as the third-party insurance rates were increased.

“The taxes we had to pay were exempted only for a month and it was of least help compared to the losses were incurring. The EMIs for the vehicle loans we had borrowed were piling up. We were given time to pay the EMIs but with an extra interest. In November and December, we did well to compare to the previous months but it was only for those two months we could do well as it was for the pre-existing orders the company had received in the month of March. To fulfil the orders received in March we had business in November and December. From January the business has come down as the pre-existing orders had been completed in November and December,” says Ashok, a transport company owner. Fuel rates have also affected the business. After COVID, cost reductions in companies have been more. “When the diesel price was Rs.58 I was charging Rs.33000 for a particular route of consignment delivery. Today the Diesel price is Rs.81 and I’m charging Rs.34,900 for the same route. I use 230 liter’s of diesel to that route. There is not much difference between Rs.33000 and Rs.34,900. Doing this my profit margin has come down. We will have to pay the EMIs irrespective of what we earn,” says Ramesh.

Mattress Logistics and Improvements

There are lot of apps coming up in the market like Porter app and is useful for the logistics companies too. The logistics company that has been badly hit can be recouped with certain improvisations. This, in turn, might help the struggling small-scale logistics companies. Here are few suggestions from the logistics industry that might help in the betterment of logistics in the future.

The logistics app introduction is beneficial to the customers. Introduction of more such apps gives a broader picture of prices to the customer. The customer can compare the prices and approach a competitive one that suits his needs. But these apps should display the details and picture of the vehicle when a customer book something. There are few companies who show a new vehicle during the time of booking and send another vehicle which is not up to the standard during the time of pick up. Such loopholes can be managed with such apps through reviews. This makes logistics more organized.

Talking about the transportation of mattresses, the type of vehicle chosen for the transport becomes equally important. Mattress is a bulky material and containers should be used to transport them. It is voluminous. Earlier mattresses were transported in open roof top vehicles. But now closed containers are being preferred and open roof tops are depleting for the reasons like theft, damage of the product if there is rain or sunny weather. Closed containers are always safe and should be preferred by the customer.

“When I was delivering goods to Orissa, I had a bad experience as there was theft on the way. Closed vehicle is a protection to the vendors,” adds Ramesh.

Recently a stumbling block has appeared for a smooth transition of business between the customer and a businessman. Entry of agents. Earlier the vendors were booked by the company owners directly and off late the game has changed with lot of agencies interfering. The population of agents are more than the vendors. The middlemen are getting the consignment booked for a higher price but in reality, the price of the consignment is not much. The company owners should directly approach the direct owner eliminating the middlemen.

Apart from the above-mentioned points, there are few other small yet important aspects that needs to be bore in mind. If a mattress company books a container, he has to bear in mind few things like the condition of the vehicle so as to making it consistent enough to deliver a mattress. The app should be updated with the latest vehicles. Old vehicles of 15 years or more should be scrapped as per government rules is a very good one. An old vehicle for delivery charges less when compared to new vehicle as the cost of the vehicle would be less when compared to the new vehicle.

For instance, a new vehicle costing around 25 lakhs will be getting an EMI of 25,000 to 30,000 and he would not be able to pay the EMI as an old vehicle would be grabbing the business. Whereas the newer vehicles efficiency is good and the delivery takes place on time. Older vehicles may breakdown in between and delivery might not happen as planned. Such events might curb the new companies from entering the field.

ISPF is an industry body which promotes importance of sleep and role of mattress for a Indian consumers. ISPF plays very important role in connecting Indian bedding industry ecosystem. ISPF also acts as bridge between India and international players.