Employee Commute - Outsourced Model and Impact of Covid-19

The corporate employee transportation service market segmented by category of passenger vehicle (cars, vans and buses), types of service (Software as a Service (SaaS), Mobility as a Service), ownership (company-owned transportation service, outsourced transportation service, leases, pick and drop transportation service) and geographical location. During the forecast period (2020-2025), the corporate employee transportation (B2B) service market is projected to show a CAGR of almost 6%. The market growth is fueled by important factors such as decreasing employee productivity due to rising average time of travel on highways, increasing level of pollution and dedication to regulate it by reducing carbon footprints.

The corporate employee transportation service market is a competitive one with very few players using fleet management and employee travel management technological support. Apart from using the new assistive technologies, many major players are growing their range of offerings.

The current and projected level of EV penetration in India could represent Rs500 billions of opportunities by 2025, as according to a report launched by Avendus Capital in July 2020. Over the last decade, the technology used in this sector has improved significantly. The world accepts the inevitability of the transition to EVs, but the plan for mainstream adoption is still a subject for debate.

The overall penetration in the electric 4W segment is expected to be 2%. With the appropriate macro environment, the number could go up to 5%. This segment is expected to be Rs 100 billion by FY25. The E-buses lead the category on the commercial vehicle side. This category would be guided by the regulatory push rather than the overall cost of ownership.

In India, the transport sector is currently estimated at $16 billion, of which around $2.5 billion is directly invested by companies. The domain, however, still suffers from a lack of technical involvement.

Having recognized the need of the market and the pain areas, Aaveg launched a unique concept of providing these services on a Managed Service model in 2015, relieving the clients from spending their precious time on a non-core job.

Aaveg being pioneer into the space, by taking over non-core activities using SaaS based technology Commutr and addressing the real problem of clients, hence changed the rules of the game completely. The client profits at significantly lower costs and at the same time explicitly achieves changes in the overall quality of service along with improving the performance of employees in their core jobs by Outsourcing the entire piece to an End-to-End model. Commutr, an in-house tool used by Aaveg to manage the entire activity, ensures 100% safety of employees through features like IVR, Call masking, SOS, Safe reach home, Covid-19 Policy and many more. The entire activity is Paperless with absolutely NO use of paper.

Pain areas addressed by Aaveg:

• Fixation of budget and control over Annual costs and fluctuations
• 100% Transparency in billing through automation
• Zero Pilferages
• Standardization of Services
• Single engagement - client does not need to manage multiple suppliers
• Enhancement is services and improved SLAs
• Safety and Security of Employees
• 100% Compliance Operations
• Induction of EVs in its fleet

As per latest NASSCOM report, travel, transport retail and manufacturing, unfortunately fall in the worst category across all the industries and the impact is likely to last for as long as 12 months. Nearly 70% of B2B start-ups list payment delays as a major problem, with the most effect on retail and fintech start-ups. 7 out of 10 B2B start-ups are also substantially decreasing their spending on marketing, the report said. B2C start-ups face a huge crunch in the distribution room, it said. The Pandemic has affected 9 in 10 travel and transportation start-ups.

Covid has promoted long-term changes in working environments, decreases in transport usage and unparalleled operator support measures. In order to safely revive the economy and restore confidence in public transport networks, the industry must work to make future commutes greener, more efficient and more sustainable as part of 'building back better' from the pandemic.

Though the pandemic has hit the topline, however at Aaveg, we have always been conscious about our costs, hence work on a lean model and same has helped Aaveg sustain business during these tough times. Since the business is spread across cities and service verticals.

Following are the new initiatives by Aaveg:

• Our focus has been on the geographies which are least impacted by Pandemic
• Investing in Electric Vehicles
• Working on some of the Consulting Projects
• Continuous Trainings to teams on SaaS platform Commutr
• Transition of a recently signed client - a large BPO at Chennai
• Work balance WFO and WFH – need based
• New Business Vertical into Human Capital space

Published Date: 11th Jan, 2021

Topic
What Would Make Indians Buy Electric Vehicles
Electric Vehicles on the Horizon
Employee Commute - Outsourced Model and Impact of Covid-19
Corporate Employee Transportation
How transport automation benefit companies
How Employee Transportation Has Become an Emerging Trend

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