Faster time to market and ever-increasing demand from the time sensitive e-commerce sector has changed the dynamics of the logistics industry. Extensive use of technology is a stepping stone in this process as they provide an ease in time-bound supply, customer satisfaction and risk-free environment. Alexandre-Amine Soufiani, Managing Director, FM Logistic India shares the details:
1. Post Covid how is the warehousing sector performing? Has the demand for warehouses remained static or otherwise in the new normal?
Over the years, the Indian warehousing and logistics industry has achieved significant growth in terms of both size and scope. Today, businesses are on the lookout for logistics service providers who are capable of integrating more technology, process and automation in their warehousing solutions and help them to move closer to their end consumers. Faster time to market and ever-increasing demand from time sensitive e-commerce sector has changed the dynamics of the logistics industry. The logistics sector has become more organised as well as standardised. Grade A warehouses and increasing use of technology are the stepping stones in this process as they provide an ease in time-bound supply, customer satisfaction and risk-free environment.
The booming e-commerce market and a robust demand for the strengthening of retail supply chains across industries, has bolstered the demand for Grade A warehousing facilities across the country. Today, there has been a tremendous shift in consumer behaviour as the majority of customers across the country – even those in Tier 2 and Tier 3 cities, have resorted to online shopping. Customers today need to have access to their required products when they need them and within the shortest period of time.
FM Logistic India is focussed on developing Grade A+ Multi Client Facilities (MCF) in the most important economic zones in India. Our Grade A+ MCFs are state-of-the-art facilities that provide the best-in-class services and are built on par with international standards. Our MCFs provide A+ grade warehousing infra with FM2 flooring and vertical storage to enable our customers to optimize space footprint. We also provide top of the line storage and handling equipment. All these offerings help us to increase the operational efficiency of our customers. Thanks to a very high flooring resistance of at least 6 T/m2 it allows up to 12m vertical storage which brings huge cubic efficiency and better productivity allowing competitive operational cost. Each of our facilities offer ample docking stations to enable the smooth flow of inventory without any bottlenecks.
2. Tier 2 & 3 cities saw an unprecedented rise in demand for the warehouses. Do we see this trend still to continue?
The Government of India’s focus on making India a global manufacturing hub has caused warehousing clusters to expand rapidly beyond the top cities and into Tier 2 and 3 cities. Also as most of the Tier 2 and 3 cities in India are aligned with industrial hubs the demand for A Grade warehouses in these cities has increased substantially. Parallelly, the increasing internet penetration in rural areas in addition to rising household income and the government’s push on digital in rural areas, has increased the pressure on manufacturing organisations to move closer to their customer base in these areas. In this endeavour to cater to the hugely untapped rural customer base, organisations have realised the importance of developing quality and world-class warehousing facilities as these facilities not only offer operational excellence but also facilitate cost optimization.
Moreover, the ongoing pandemic has severely impacted several sectors of the economy, including the warehousing sector. As the internet penetration in India continues to grow, and with the shift in buying behaviour by consumers in smaller cities due to COVID-19, e-commerce growth is likely to accelerate. This will further increase the share of e-commerce demand in the medium to long-term even in smaller cities. As a result of which, the need for fully compliant Grade A properties that increase the efficiency of the supply chain continues to gain momentum. Due to the nationwide lockdown, delivering essential services to the masses became a necessity, which has resulted in a significant growth in the Tier 2 and Tier 3 warehousing markets. The growing e-commerce market, too, has undoubtedly increased the demand for warehousing in various cities across India – especially Tier 2 and Tier 3 cities. The e-commerce market, which has witnessed significant growth during the pandemic, is forecasted to grow further in India.