STALLION

DELIVERIES
SYED MURTAZA NADEEM AND QAZI-SHAKEEB UDDIN

LOGISTICS INDUSTRY OF
PAKISTAN
Logistics industry of Pakistan comprises of big
players in the market including TCS and
Leopards.
Oligopolistic structure where the market is
dominated by few large players.
Since these firms operate on a large scale, a
market niche existed that satisfied the working
capital requirements of the online retailers.

INTRODUCTION AND COMPANY

BACKGROUND
Stallion deliveries was started as an IBACED
Incubatee Company. Core aim was to
revolutionize the supply chain and logistics
industry by implementing innovative idea.
Stallion Deliveries grew at a tremendous rate at
IBA, and within a year or two of its operations,
it was acquired by ARY group due to its unique
business model.
Stallion Deliveries is a B2B company that offers
its services to various online retailers,
businesses and Banks.

SERVICES PROVIDED BY
STALLION DELIVERIES
Stallion Deliveries provided an efficient Cash on
Delivery (COD) as its first service. The purpose
of this service is to connect the client with their
customer in the fastest way possible.
Stallion Deliveries provided cash payback
period of less than 24 Hours at no additional
charge
Remittance delivery service.

PRICING
Weight

Regular Rs.

Bulk Rs.

Upto 0.5 kg

170/-

130/-

Between 0.5 And 1.0 kg

200/-

160/-

Each Additional kg

120/-

120/-

Outstation

Weight

Regular Rs.

Bulk Rs.

Upto 0.5 kg

270/-

230/-

Between 0.5 And 1.0 kg

300/-

260/-

Each Additional kg

170/-

170/-

Profit Equation = Quantity*( selling price cost price)

The margin of Stallion is around 30-40 per delivery.
This means stallion can increase its profits if its
operates on a larger scale.

PROMOTION
Stallion Deliveries promotion is not carried out
on mainstream media as it is operating on a
smaller scale and it would not be possible to
meet the excess demand created.
Thus Stallion uses social media such as
Facebook to advertise its services.

PRODUCT PORTFOLIO DIVISION

Currently, the division of product portfolio is
based on the composition as stated below
Cash on Delivery: More than 80%
Remittance and Cash in Transit Service: 10-15%
Warehousing and Inventory Management: 3-4%

BUSINESS MODEL OF CASH ON

DELIVERY SERVICE
The first step is the placement of the online order. As
soon as the order is recorded on the terminal of Stallion
deliveries, it will be recorded instantly on the database
and the business is updated instantly with the delivery
status. If the delivery is placed within the three main
cities i.e. (Karachi to Karachi, Lahore to Lahore or
Islamabad to Islamabad then it is completed within 24
hours, however if they are outside the city then, it is
completed within 72 hours.
Payment is made within the next 24-hours of the delivery.

UNIQUE SELLING PROPOSITION

The USP of Stallion that differentiates it from other
Logistics companies is its 24-hours cash payback
system.
This means that stallion pays back to the suppliers within
24-hours once the delivery has been made.
Even big players like TCS and Leopards are unable to
reduce their cash payback to 24-hours. Leopards Courier
Service brought it down to 3 days for its bigger clients
and TCS had reduced its cash payback cycle from 10
days to seven days.
Reduced cash payback helped online businesses in their
working capital requirements.

CAPITAL AND HUMAN

RESOURCES REQUIRED
Capital required includes timely injects that are not an issue
since this is a profitable venture acquired by ARY and ARY can
easily cover the financing requirements of Stallion Deliveries.
Biker and Cargo vehicles are required to transport the goods.
Warehousing is also a investment that is required by Stallion.
They will increase the number of warehouses in the future.
Human resources required are the Riders who will transport
the goods and remittances.

RETURN POLICY AND THE 3-43 FORMULA

The first three days the parcel is in transit and the first
attempt of delivery is made. If the delivery is unsuccessful
then Stallion holds the parcel for 4 days till they are
instructed to reattempt, however if the customer refuses and
the shipper also says that the delivery has not been
completed then Stallion will call back the order and it takes 3
days to be returned. Mostly three attempts are made in order
to deliver the order. The order is called back because the
shipper will be working with Stallion Deliveries in the future
again.
So for example Sana Safinaz would get its inventory back
within 10 days if it is returned so that they can put it back to
sale.

GOVERNMENT REGULATION
AND INTERFERENCE
In 2015, PM Nawaz Sharif gave Pakistan Post a status
of Logistics Company. First thing they did was to start a
Cash on Delivery Service. Stallion, TCS, Leopard offer a 1
kg parcel in Rs.200. whereas Pakistan post started to
charge Rs.25.
So if anyone gets Rs.25 delivery charges instead of
Rs.200 thats massive. In case an online store has 100
parcels daily and saves 150 rupees per parcel it saves
Rupees 15000 daily and thats massive saving.
But the problem with Pakistan post is that it is
Government owned so it has a lot of glitches and gaps.
Longer delivery time and loss of parcels are major
problems with Pakistan Post.

SWOT ANALYSIS
STRENGHTS
Strong hold in the COD delivery service
First company to introduce remittance delivery at door
steps
First company to introduce 24 hours cash payback
service

WEAKNESSES
Own Fleet is non-existant
A huge risk involved in COD service

SWOT ANALYSIS
OPPORTUNITIES
Partner with remittance companies to deliver their
remittances at door steps.
Establishing warehouses in order to store the inventory
and reduce the lead time
Reducing the risk involved by partnering with Insurance
companies

Threats
Giants like TCS, OCS entering into COD services.
Risk involved in carrying big amount of cash.

Online stores introducing their own delivery services

CHALLENGES DURING EVOLUTION

In the start when stallion was IBA-CED incubate
they had budget constraints, they was no
proper HR system and biggest of all was the
infrastructure problem.
In this process a lot of working capital is
involved in the process which poses a huge
challenge.
A lot of shipments in the beginning used to
spoil because of one problem or the other

NEW WAREHOUSING CAPACITY

Up till now Stallion was working on head to
head to delivery with warehousing constitutes
only 3-4%
But in near future they will be buying
warehouses in Karachi and Lahore.
The upcoming challenge and competitive
advantage in courier industry is to reduce the
lead time.
Stallion instead of having fleet or charter plane
has worked on this idea

NEW WAREHOUSING CAPACITY

This will reduce the lead time of stallion
deliveries and it will deliver the goods in a
lesser time.
Hence it will cost lesser than adding fleet or
Charter Plane