Manish Agarwal, a New Delhi-based chartered accountant, was on a business trip to Mumbai when he had to make a difficult choice: whether to go to his hotel to drop off his luggage or transport it to the megalopolis.
“I was at the airport when an urgent meeting was scheduled in Andheri. But my hotel was in Colaba, about 30 km from Mumbai airport. Going to the hotel to leave my luggage meant I would be late for the meeting. There was no place to put my luggage and I had to lug it to all my meetings that day. It was very uncomfortable,” Manish recalls.
After returning to Delhi, he talked about this problem with his friends and family. He soon realized that the lack of safe and affordable changing rooms for temporary storage of luggage was a common problem.
Manish and his former Indiamart colleagues, Mukesh Goel and Vidyanand Tripathi, decided to solve this problem for travelers and conceptualized. They brought on board a mutual friend, Alok Goel, to manage the technical aspects of the platform.
How it works?
Launched in 2019, Lugsto is a mobile and website-based platform that helps travelers find safe and affordable “locker rooms” to store their luggage for a few hours or a few days.
The New Delhi-based company has a network of 160 storage spaces in 40 cities, including Tier I cities like Delhi, Mumbai and Bangalore, and Tier II and III cities like Guwahati, Indore and Lucknow.
“Lugsto’s main customers are people who travel to different cities for work, exams, vacations, etc. and don’t want to book a hotel or a taxi just for their luggage,” says co-founder Mukesh .
Although Indian Railways offers cloakrooms at main stations, these are reserved for people traveling by train with a valid Passenger Name Record (PNR). There are no government-run changing rooms for other modes of transportation, be it buses or planes.
This is the problem that Lugsto aims to solve by providing locker-type facilities for all travellers, regardless of mode of travel.
“Customers visiting the website or mobile app are required to enter a few details like the date and time of drop-off and pick-up along with the number of bags to be stored. The platform then displays available options near the customer’s location,” says Mukesh.
Bootstrapped Lugsto does not have any installation; it partners with hotels, shops and offices that offer tie-down in exchange for a commission ranging from 30-50%, depending on the accessibility of the location.
Charges are based on the number of bags and the number of days the service is required. Prices generally vary between Rs 40 and Rs 150 per bag per night. Customers must deposit their luggage themselves at the chosen location.
The platform offers features such as GPS navigation and baggage insurance. Customers can retrieve baggage from storage only through an OTP, which must match the unique barcode assigned to the baggage.
Lugsto has a team of 17 people, all based in New Delhi.
Challenges and future
Lugsto’s team has had its fair share of problems – from building the technology to securing luggage and finding partners.
A year after its launch, COVID-19 has brought the world to a standstill and travel has come to a complete halt. The stevedoring service was not needed at all, which resulted in trouble for the founders.
“The first phase of the pandemic hampered our activities. But there is always a way to see things differently and positively. We decided to work on improving the technology and strengthening our network of partners. When the lockdown was lifted, our network helped us bounce back,” says Manish.
Lugsto competes with websites such as Boxigo, StoreMyGoods, Stownest and shares similarities with Nannybag, a mobile and web-based platform that helps travelers drop off their bags during short visits to cities like London, Brussels, Lisbon , etc.
However, Mukesh says the startup stands out because the platform is accessible both as a mobile app and a website, allowing travelers to book locker rooms from anywhere in India.
According to documents filed with the Registrar of Companies, Lugsto had a turnover of around Rs 3 lakh as of March 31, 2021.
A report by Markets and Markets indicates that the size of the global smart warehousing market will grow from $14.8 billion in 2021 to $25.4 billion by 2026, at a compound annual growth rate (CAGR) 11.5% over the forecast period.
Lugsto aims to exploit this demand.
His future plans include setting up a “cloakroom” in each locality, so that the service is “accessible in five minutes”.
By 2024, the team aims to be present in 110 locations with 1,000 stores and to have a baggage collection and drop-off plan in place. “We also plan to expand outside of India,” said co-founder Manish Agarwal.