Logistics refers to the process of coordinating and moving resources like people, materials, inventory, and equipment from one location to the final destination. Logistics involves things like transportation, inventory, packaging, supplies and warehousing. India’s logistics sector is highly defragmented and the government is aiming to reduce the logistics cost from the present 14 percent of GDP (Gross Domestic Product) to less than 10 per cent by 2022. With the ecommerce industry growing exponentially during the pandemic and thanks to advancements in digital technologies, there has been a massive transformation in how a logistics company in India is conducting its business. And this is getting reflected in the workings of those companies that are situated in Mumbai, a city bustling with many businesses and industries.
Few challenges faced by logistics companies in India
- Fluctuating transportation costs due to fuel prices and maintenance
- Providing timely and best delivery
- Enhancing customer experiences
- Manpower management
- Transparency and visibility in supply chain activities
- Government and state rules and regulations
- Lack of proper digitalization of processes
The logistics market in India is forecasted to grow at a CAGR of 10.5% between 2019 and 2025. Government reforms and investment are also playing an important role in the growth of this sector. Safexpress, a leading supply chain and logistics company provides logistic services in various industries like e-commerce, health care, automotive, FMCG and many more. A few of the services offered by the company are Easy2Move Express Distribution, 3PL, inventory management, consulting and so on. With their operations spanning PAN India, Safexpress is well-equipped to provide logistics services to its customers.
Key initiatives provided by the Indian Government
- Drafting of a national logistics policy to aid in streamlining rules and addressing supply-side constraints, which will lead to lower logistics costs
- Generation of a single-window e-logistics market
- Promoting multi-modal infrastructure
- Promoting cold chain facilities and adoption of reefer (refrigerator) trucks in strategic locations
Key initiatives provided by the Maharashtra Government
With logistics sector being accorded industry status by the Maharashtra government, it has benefited immensely under the state logistics policies. These policies will help logistics companies in Mumbai to avail a variety of services, process and facilities to accelerate their growth.
With two major ports, a major airport and good road infrastructure, the logistics companies in Mumbai can never fall short of businesses. In addition to this infrastructure, you can find major warehousing clusters located in and around Mumbai.
The Maharashtra government has invested around over Rs 150 crore in the supply chain and logistics sectors in Pune and Thane regions to promote multi-modal connectivity, technology driven accreditation, and a standardization process, to support the supply chain ecosystem within the state.
The logistics and supply chain sector in India play a significant role in business continuity and also propelling the nation to become a global investment destination. While the central government is working on a ”National Logistics Policy” to promote seamless movement of goods and commodities across the nation, state governments are also investing generously in the logistics sector.
Digitalization of the various processes involved in the logistics industry will improve the efficiency and performance in operations. Warehouse automation will also aid in achieving operational efficiencies to offset supply-chain cost pressures in the industry.
A combination of government reforms, increased investment in infrastructure, last-mile connectivity, growing ecommerce sector, and emerging new technologies is likely to see major and new logistics companies investing in the logistics industry. The future of logistics companies in Mumbai as well as the rest of India is sure to experience exponential growth in the coming years.