Gurgaon based logistic firm GoJavas had suspended its operations last week amid an organisational overhaul, in a cash and stock deal. It was in talks with courier service providers Pigeon Express Pvt. Ltd and Trackon Couriers Pvt. Ltd to acquire GoJavas. However, further talks are going between Pigeon Express and GoJavas, reported livemint.
GoJavas was founded in 2013 and got $20 million funding from Snapdeal in October 2015. Everybody was under the belief that Snapdeal might take up GoJavas as it holds 42 percent of stakes. However, talks with Snapdeal were not fruitful in acquisition. This made Snapdeal to go with its in-house logistic firm Vulcan express.
Pigeon Express is one of the fastest growing Inter-city courier services and is operating from Delhi from September, 2004. It offers numerous products and services that includes doorstep pickup and delivery of bulk packets, parcels and other consignments. It has 135 delivery centres and holds around one lakh deliveries every day and also faces stiff competition from DHL, BlueDart, Professional couriers and others.
The failure of three year old GoJavas was mainly because of overdependence on two e-commerce companies; Snapdeal, which was recently dropped its second position to Amazon and using Vulcan express for its deliveries; Jabong, which was taken over by Flipkart for $70 million. 80 percent of GoJavas’s overall business was taken over by Snapdeal and Jabong. They failed to acquire new clients and now they have no big clients which resulted in their suspension of their operations last week as reported in livemint.
Business Insider reported that GoJavas was delivering in 300 towns in February 2016 and was targeting 600-800 towns and cities in next one and a half years but now it has suspended its operations. This shows how dependent GoJavas on Snapdeal and Jabong.