How Sendy is using machine learning to transform logistics

Only a few innovators in Kenya’s startup scene can remember an e-ticketing platform named M-Shop that won the inaugural Pivot East venture capital competition in 2012 but crumbled in two years’ time.

But many Kenyans can identify with Sendy, Silicon Savannah’s first on-demand delivery service whose delivery vans, motorbikes and trucks have been more common on Kenyan roads during the pandemic.

Launched seven years ago, Sendy’s success is partly due to the lessons Meshack Alloys, the firm’s co-founder and chief executive learned when he was part of a team of three innovators that had designed M-Shop.

Over the years, it has been a journey of learning through Africa’s tech ecosystem, spreading digital logistics services to Uganda, Tanzania, South Sudan and the DRC.

“I was the pioneer in deploying tech to ease courier services. I had so much to learn from, so many values to train subscribers and a lot of technological advancements to adapt to in a short time,” he told Business Daily.

Innovation

After the M-Shop setback, Alloys got wiser in the next innovation, this time round teaming up with Evanson Biwott, Don Okoth and American Malaika Judd to launch Sendy in November 2014.

They have helped him steer the firm towards the future of logistics, utilising frontier technologies to achieve enviable customer service satisfaction, where deliveries now take 30 minutes within Nairobi city and its suburbs, compared to seven hours through legacy courier services.

Using geo-location data algorithms and machine learning, a key subset of Artificial Intelligence, the engineering team of 60 developers at Sendy has created an app where customers can track their goods on transit till they reach the receiver.

“Machine Learning has been at the centre of everything we do.  We have digital tools that help us to bolster entire supply chain planning, allowing us to significantly optimise decision making processes,” he expounds.

Analysing huge data sets and applying intelligent algorithms has been the epicentre of the global digital economy, but many African startups struggle to realize the business potential of the technology, Sendy being an exception. 

“Real-time Big Data analytics helps us to balance demand and supply. With machine learning, human intervention is minimal. You won’t have to analyse those loads of data on your own, there is zero chance for inaccuracies,” he says.

 Just like Silicon Valley’s Uber, Airbnb, Instacart and RVshare, Silicon Savannah’s Sendy uses an asset-free model, with an app that coordinates contract drivers who own their own vehicles, trucks and motorcycles while confirming deliveries, creating performance metrics and managing payment.

On the firm’s business and revenue model, “We take only 20 percent of the fees paid and give our driver 80 percent. We also facilitate services for drivers like insurance, safety, tracking, vehicle financing, servicing and fuel credits,” Alloys illustrates.

The asset-light business model requires less capital to put a venture into action, whereby instead of spending a large sum of money to own all of it, you pay a certain amount of capital to get things done and share the profit.

Data seen by the Business Daily shows that as at May 2021, the firm had signed up 10,000 drivers, with a sharp peak in demand being witnessed from April 2020 when the Kenyan government imposed total lockdown measures to help curb the spread of Covid-19.

“We have served over 100,000 clients in the past 12 months. The pandemic has spurred demand for our services due to the contactless delivery requirement by the government,” Alloys says, adding that the trend will continue even in the post-pandemic period as customers love the convenience.

Urban dwellers

Many urban dwellers have opted for Sendy services to deliver fresh produce to their houses, as well as hot food and cold drinks from restaurants, compared to traveling by themselves to purchase the goods.

Parcel weight ranges from the small 20 gram documents to the middle weight food deliveries, clothes, laptops, phones to the heavy ones where you can get your imported car or truck transported from Mombasa port to the destination you want.

Depending on distance, weight, sensitivity, value, time and location, end users pay a base price of between Sh90 and Sh10,000, with every extra kilometre being charged at between Sh50 and Sh80.

“Since I joined the Sendy platform in January 2019, it has been a business boon for me. On average, I make Sh2,000 daily,” said Calvin Munyasya, a Sendy motorbike rider.

Users who have used the solution say it has transformed logistics as they knew it, making it easier to move goods across towns and even to the rural areas.

A lot of money

“The app is very efficient, saves you a lot of money. I used the van for the first time and the pickup for the second time. The delivery prices are very economical, the drivers and the team are very supportive and nice,” comments Jimmy Karago on Facebook.

However, he adds that end users will have to cope with a longer waiting time, though, to him, it is the most affordable way to transport furniture or building materials over long distances.

“I would recommend you order 30 minutes before you need the goods transported,” he says.

But just like other successful startups, Alloys says Sendy is facing talent competition from big tech companies but through constant upskilling, the company has sharpened its talent pool to compete on the global stage.

“The future of logistics is in autonomous transport where self-driving bikes, vans and motorbikes will be ferrying goods to people’s desired destination. There will be more use in electric transport and consolidations that will be the new backbone of economic progress.”

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