Before 'Big Billion Day', Flipkart promises on-time delivery with new tech

This festive season, millions of Indians will simply click ‘buy’ on Flipkart and not think about the complex process of shipping an order across the country to their doorstep. However, for Flipkart, this is perhaps the most critical part of its business and it needs to be constantly on the ball to ensure that there isn’t the slightest glitch in its supply chain.

The Walmart-backed e-commerce giant has now invested in a system that gives it end-to-end visibility of each and every shipment flowing through its logistic pipelines.

This, the company hopes, will allow it to function smoothly even on its big sale days when it ships four to five times the number of products than it does on any regular day.

“We have launched this capability ahead of the upcoming Big Billion Days (BBD) sale. It’s been built in-house and is tailored to meet the specifications of shipping uncertainties that are typical to India,” says Krishna Raghavan, senior vice-president of engineering at Flipkart’s logistics unit, Ekart.

Hence, if there is a bandh or a rasta roko or any other disruption to the supply chain, Flipkart’s new artificial intelligence-based system automatically reroutes a package to ensure that it reaches the customer on time. Since the emphasis is on customer satisfaction, it also prioritises quicker deliveries over cost savings.

The cost efficiency comes in the form of a technology stack that is like Lego blocks — they can quickly be assembled to add more capacity, and just as easily be dismantled once the peak demand has passed. “We can easily rent a temporary warehouse or delivery hub to cater to the increased demand during BBD. The hard part is to integrate this asset with our existing supply chain. But with the modular architecture, we can overlay the technology required at a temporary unit with the click of a button, thereby giving us instant capacity addition,” explains Utkarsh B, principal architect, Flipkart, who has designed the new system.

Unlike its rival Amazon which has invested heavily in setting up excess capacity to cater to demand spikes, Flipkart’s solution is scalable. However, in contrast to Flipkart’s own delivery hubs and warehouses, where engineers can tweak and improve systems over time, everything needs to start working perfectly and at once at these temporary locations.

“One of the tools the team has created allows us to optimise the flow of products in and out of a warehouse taking into account its physical layout. The other relates to quickly training temporary workers who come in during BBD. At our own facilities where there is stable manpower we can spend a lot of time training them, but we don’t have that luxury at our temporary centres,” says Pranav Saxena, vice-president of products, Ekart.

For the upcoming BBD sale, Flipkart will hire 30,000 temporary workers. Most of them will support the logistics and delivery functions over the next one to two months. 
 

To understand the platform, one needs to understand Ekart’s function, which begins the moment a customer clicks to buy a product on Flipkart. The work involves finding the closest storage site where the product is available to the customer, picking, packing, and shipping it through multiple hubs before it gets delivered to the customer. 

Once an order is received, a worker at one of Flipkart’s fulfilment centres gets an alert on his hand-held device, prompting him to go and pick up a product which is placed at a designated spot. After the ‘picker’ reaches the spot, he scans the barcode on the shelf to let the system know that the right product has been picked. He is then instructed via the device to drop off the product in a particular bin or onto a particular conveyor belt. Now multiply this by a few million orders at any given time. 

The various technologies used — such as Internet of Things that powers the handheld devices of pickers, the code that determines the fastest route for a picker to go to the warehouse, the barcoding database and even the connected conveyor belts — are all packaged into one prefabricated module. This module is deployed in any new fulfilment centre that Flipkart sets up. 

The artificial intelligence-based supply chain systems also determine the best route for a product to get to a customer. The AI then makes the right prompts at the right locations to ensure that the parcel keeps moving along the set route. It can also make changes on the fly and come up with alternatives if there are any disruptions to the route or schedule. 

“We believe in simplicity and try to break everything down to its fundamentals. What we’ve done with our supply chain is essentially deconstructed it to Lego-like building blocks,” adds Utkarsh.

Apart from using technology solutions to make sure that people get their orders on time, Flipkart is busy with another task: it is harvesting the deluge of data that it gets every sale season when millions of new customers come on to its platform. The data is run through high-level machine learning algorithms that the team has developed to predict future growth. Based on data from the previous four BBD sales, Flipkart already has a good idea about what business could be like among people in a corner of India who have never shopped on the platform before.

“For example, during BBD we may get two orders from a particular pincode. But now we can predict with some accuracy as to how demand from that region might grow in the next few months or years. This is important because then our system might tell us to reroute an existing supply line to include that area, or maybe set up a dedicated supply line there, and then, if things go really well, maybe even set up a hub nearby. It’s all interconnected,” Saxena says.

Flipkart knows that keeping the connections in its supply chain firing smoothly will make the customers troop in.  

BUILDING BLOCKS

Modular architecture  Allows Flipkart to set up temporary warehouses and delivery hubs only during times of high demand. This means  the company can save costs by not investing in excessive supply chain capacity

Plug-and-play The technology stack allows Flipkart to have its temporary supply chain assets up and running quickly as it can make adjustments by itself to ensure adequate efficiency is maintained

Feedback loop The data gathered by the supply chain unit during the festive season, such as where new customers are coming from, will be analysed to predict future growth