As investors turn into a nervous bunch suffocating the supply of fresh capital, Rivigo is considering a potential sale. It may or may not merge its operations with either Flipkart’s logistics arm Ekart or omnichannel retailer First Cry’s logistics unicorn XpressBees, according to sources.
A few months ago, the company’s board decided that it should look for potential buyers and that staying independent wasn’t an option anymore, said a person in the know of the development. As per another, the company is not in great health, and has tweaked its business model multiple times, while its fleet size reduced significantly.
It is being touted as a good move on behalf of Rivigo to approach e-commerce companies with a logistics arm, however, no acquisition deal has been finalised yet. In fact, when ET asked Rivigo about their plans to give up business, they said they were rather looking towards closing a round of fresh funding.
Rivigo initially operated on a ‘relay trucking model’ but during the pandemic, it pivoted to ‘relay-as-a-service’, which according to the organisation’s leadership, made the company more sustainable and conducive to scaling. However, after the pivot, Rivigo’s revenue dropped to less than Rs 1,000 crore and in May, the logistics firm was operating at a revenue run rate of about Rs 700-800 crore.
Though Rivigo initially targeted e-commerce companies as its customers, the share of e-com in its consumer base is pretty low now. Rivigo’s customer base includes pharma, auto, auto component, electrical goods, and consumer durable companies for its full truck load business. As for the partial truck load vertical, companies from e-commerce, apparels, auto components and distribution, pharma sector are its clients.