Railways to retail on track

Accountancy firm KPMG has pegged the revenue potential that can be generated using e-retailing at Rs 7,000 crore

Published: 11th September 2016 09:09 AM  |   Last Updated: 11th September 2016 09:09 AM   |  A+A-


NEW DELHI:After announcing surge pricing in rail fare in premium trains, Indian Railways is exploring options to start e-retailing service on-board trains similar to what airline passengers get, and this could generate around Rs 7,000 crore per annum for the cash-strapped national carrier.

The Railways is mulling to analyse the socio-economic profile of its passengers on all 13,000 trains and will present items that have maximum potential for sale on board a particular train. The products could range from branded gadgets to gift items and travel accessories, and it will come with a bill and warranty. Also on the discussion table are plans to offer discounts and free gifts to popularise the scheme.

According to the Railways, e-retailing on trains will generate huge revenue as it carries 23 million passengers daily. The Railways has been exploring innovative ways to generate revenue and has also set up a separate directorate to look into non-fare revenue options.

“The basic premise is that passengers in a train, available for three to 24 hours will resort to impulse purchase. This attitude will be leveraged in e-retailing,” a senior railway officer said.

Accountancy firm KPMG in its analysis has pegged the revenue potential that can be generated using e-retailing at Rs 7,000 crore annually.

“E-retailing can be used for generating revenue as a direct stream of business, by leveraging the data captured on the socio-economic profile of the passenger. There are also plans to set up facilitation centres at railway stations, and this will enable positioning of goods on-board the trains and ensure delivery on arrival at the station,” the officer added.

The idea is to use information and communication technology to capture the data, analyse it train by train based on journey dates, and use relevant profile to present products that have the maximum potential.

“I find the idea very interesting as there will be an option to buy good products while enjoying a train journey,” said Rajat Gupta, a frequent traveller.

Monetising data information such as passenger preferences and ticketing patterns to companies for analysis and a digital advertising network on platforms, ad-wrapped trains are some of the areas being explored by the railways to add to its revenue kitty.

A study by RITES, a Mini Ratna Central Public Sector Enterprise under the Ministry of Railways, stated that railways has the potential to earn Rs 10,000 crore a year just by selling space for advertising in coaches, wagons and platforms, among others. According to the railways, the RITES assessment is conservative and it could generate much more revenue.

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