Sunday, January 24, 2021

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The warehousing and logistics landscape has been witnessing a paradigm shift and transformation in India. From an increasing number of policy incentives to tech-enhanced warehouses, the sector is now seeing a change in every aspect of its operation and Covid-19 pandemic has made the change and the need for upgradation and modularity all the more prominent, writes PRERNA SHARMA.


The continued growth of the e-commerce sector in India is leadingto increasing demand for effective supply chain systems and highlyautomated warehouses. Recognizing the contribution of this segment to the overall growthof the economy, the government is determined to enact structural reforms, which aim at improving physical connectivity and infrastructure developments, resulting in attracting domestic as well as global investments. While the post-Covid era will be evidently different than what we saw till the year 2019, the warehousing infrastructure companies shouldn’t let their guards down in implementing the genx advancements to offer value-added dynamics to their clientele, which will offer them an edge in the long run.


Fast Facts
  • Healthy demand growth in Pune, Mumbai, Ahmedabad in FY 2020; NCR saw largest volume of absorption of warehousing space
  • Patna and Jaipur witnessed over 3X growth in warehousing demand of 200% and 223% respectively in FY2020, albeit on a low base.
  • 3PL leads in warehousing demand, with a share of 36% in FY20, followed by e-commerce and manufacturing sector.
  • E-commerce warehousing demand growing at a strong 55% CAGR since FY2017; expected to drive growth in demand for next few quarters
  • E-commerce share in the warehousing demand increased to 23% in FY2020 from 14% in FY2018.                                                                               Source: Knight Frank Report


According to Research & Markets research, the warehousing market in India was valued at `1,501.2 billion in 2019 and is expected to reach `2,821.1 billion by 2024, expanding at a CAGR of ~13.57% during the 2020-2024 period. Traditionally ranked among one of the overlooked sectors in logistics, warehouses today have developed into sophisticated stockrooms with advanced state-of-the-art facilities like real-time tracking mechanisms in India. Various initiatives taken by the Indian Government have been driving the country’s warehousing market towards growth, but investors had started taking cognizance of the sector much before the implementation of these reforms like granting infrastructure status to the logistics industry including warehousing. The warehousing market in India accounts for approximately 25% of the total logistics cost. The warehousing market is sub-divided into four industrial segments namely industrial or retail warehousing, container freight station or inland container depot (CFS/ICD), agricultural warehousing and cold storage. Among these segments, agricultural warehousing is expected to witness the highest growth rate of ~17.87% in terms of revenue, during the 2019-2024 forecast period.The agricultural warehousing market was valued at `145.82 billion in 2019 and is expected to reach `365.75 billion by the end of 2024. As of 2019, India has a total agri-warehousing capacity of around 91 million metric tons with majority of the capacity being owned by state agencies. Growing need of proper storage of fruits and vegetables in the country is fueling the demand of agri-warehousing in the country.Currently, India’s total warehousing capacity is estimated to be 160 Mn tons. Around 60% of the modern warehousing capacity in India is concentrated in the top six cities of Ahmedabad, Kolkata, Bangalore, Chennai, Mumbai, and National Capital Region (NCR). Warehousing spaces of organized players across eight major cities in India experienced a year-on-year growth rate of ~77% in 2017 to reach 46.2 million square feet in 2018. 3PL, e-Commerce, Fast Moving Consumer Durable (FMCD), Fast Moving Consumer Good (FMCG), Manufacturing and Retail industries are the major adopters of organized warehousing spaces in the country. Among these the 3PL and e-Commerce players continued to be the biggest adopters of organized warehousing spaces in 2018. The growth in the Indian e-commerce industry is fueling the demand as well as the development of the logistics and warehousing sector of the country. E-retailers are now more aggressively looking forward to opening up warehouses in tier I and tier II cities as well as collaborating with well-known logistics service providers across the country to be able to maintain a minimal delivery cost.



Key influencers:


The warehousing and logistics sector in India is projected to attract an investment amount of nearly `691 billion over the next 4-5 years, after the implementation of the Goods & Services Act and the attainment of its infrastructure status. The warehousing sector in the country has witnessed extensive participation from developers, as well as institutional investors, who have invested more than `470 billion since 2014 till May 2019, with an average investment of `19 billion per deal.


The growth in the warehousing market in India is also largely being driven by the rise in international business. Entry of numerous foreign as well as domestic industries in the country and establishment of manufacturing plants have generated greater export opportunities, which in turn has fueled the demand for warehousing spaces across the country.However, lack of infrastructure is one of the biggest hurdles in the warehousing market in India. India has the lowest warehouse capacity with modern facilities when compared to the rest of the world Additionally, poor road conditions, bad connectivity, inability to handle high traffic density and insufficient air and sea port capacities contribute to the increased cost per transaction in the country’s logistics sector.




We believe in constant learning and development. We have been one of the early birds in our category and that gave us an opportunity to experiment and innovate. This also led us to learning from our own mistakes and evolving continuously. Our team of experts and best practices have kept us ahead of our competitors and this gives us an edge over others in the industry. Our core has been about delivering value to our customers and we believe in nothing less than the best when we say Grade A. We are in a journey of excellence and our growing number of customers give us an assurity of success. ADITYA VIRWANI, COO, EMBASSY GROUP






We at Welspun One work towards providing best-in-class industrial real estate to our customers. Our marquee project in Bhiwandi is designed for global standards and has Green Building Certification requirements. The park with its best facilities will emerge as a key asset in the hub of Mumbai’s warehousing market. Designed by global logistics experts, the project will be built on industrially advanced features like park management and maintenance on a tech-enabled platform, an IOT driven traffic management system to minimize travel distance, and trucks with RIFD tags to predetermine directions and docking. The park will rely on software, sensors, and digital interfaces to streamline compliances. ANSHUL SINGHAL, MD, WELSPUN ONE LOGISTICS PARKS






Innovations Galore
Growing up in Lasalgaon in Maharashtra, Asia’s largest onion trading market, Kalyani Shinde is all too aware of problems that farmers face due to dramatic market fluctuation rates of the crop. The 23-year-old then put her education in computer engineering to use by innovating a tech-enabled storage solution to avoid wastage in the warehouses. After a brief cultivation period of 120 days, farmers start incurring losses during the storage period of six to eight months where nearly half the produce gets spoilt. Kalyani’s startup Godaam Innovations leverages IoT to detect gases emitted when onions starts getting spoilt, collect real-time data, and alert the farmers. Founded in 2018, the tech entrepreneur is hopeful of community warehousing becoming the future of storage.
Movement has always been at the core of innovation in human history. We have always endeavored to make the movement in daily lives easier. With the same intent, Addverb has developed a slew of robotic solutions and innovative products that focus on optimizing the movement of goods in warehouses and factories but also ensures the human movements are more productive, safe and ergonomic. The latest innovative offering from Addverb is Quadron, India’s first carton shuttle robot. It can be classified under Goods-To-Person technology. Designed & developed by Addverb, it allows maximum utilization of space in a warehouse along with the ability to handle a high number of SKUs and enables rapid picking.Quadron allows storage of material in a carton/crate/tote with a varying payload of up to 50kg. It is created for applications where a large number of SKUs are to be handled, high throughput and each picking is required along with the utilization of height of the warehouse and increase the storage space.
Nest-In, Tata Steel’s modular construction solutions brand, has launched a revolutionary onion storage solution ‘AgroNest’ that is aimed at reducing spoilage of the onions to half of its current level.This is a first-of-its-kind smart warehouse for onions developed with scientific backing and latest innovation and technology. The lack of scientific storage practices, non-standard designs and poor quality of material used for onion storage leads to over 40% loss of the produce inside the warehouse. With unpredictable weather and climate changes and the recent challenges of transport and movement, farmers face multiple challenges with respect to storage and maintaining a healthy shelf life for their produce. Over the years, the farmers have suffered losses in quality and quantity of their produce, as the onion industry lacks proper storage facilities.
Agronest, a smart warehouse solution with a unique structural design that maximizes air flow, is spacious thus making it conducive for longer and safer storage of onions and provides a cost-effective environment control to ensure minimal wastage. The warehouse has sensors installed for monitoring temperature, humidity and gas, thereby enabling early detection of spoilage of the produce.


Latest trends:


Warehouses face a number of challenges. Retail footprints are shrinking as more consumers opt to purchase online. For warehouses, that means shouldering a larger storage burden to compensate for the shift from brick-and-mortar shopping to e-commerce. That translates to an increased staffing need, which is only further complicated by tight labor markets.During peak periods, warehouses can experience 3-5x volume spikes.


Most warehouses are very manual as traditional hardware and software solutions are only accessible to the largest companies.


A very manual warehouse leads to slow processes, inefficient workflows and being prone to human errors. This creates a need across many companies for scalable solutions that don’t require a substantial CapEx investment — and, ideally, work with a warehouse’s existing infrastructure and layout. 6 River Systems highlights some of the defining trends that the warehousing sector would witness in the coming years:




The logistics marketplace


Warehouses, and the supply chain as a whole, are moving to a more integrated approach that supports transparency and visibility, for the warehouse, its logistics partners and consumers.


Let’s look at a few trends in the logistics marketplace that will influence the warehouse of the future. Effective capacity management is the foundation of a functional warehouse. Capacity planning is complex, though, requiring ongoing analysis of the four Ps: Product, Promotion, Peak and Predicament. If capacity management isn’t a priority, many warehouses find that slow-moving (or obsolete) inventory has quickly taken over all available space when you need it most.


The warehouse of the future will take advantage of automated capacity management by leveraging technology for better, data-driven capacity planning. The result is fewer capacity planning errors that can lead to lost revenue and improved space utilization, which translates to a healthier bottom line. On-demand warehousing is another trend to emerge from the need for greater warehouse flexibility to accommodate temporary demand for additional capacity. This trend enables companies who have built their warehouse to handle their peak season demands to monetize unused space during quieter times of the year.


Automation as a service is a fast growing business model where customers can deploy automation on an as needed basis. It’s gaining prominence because it provides facilities with the ability to rapidly scale up and down as demand dictates and allows buyers to expand or experiment with technologies such as robotics without going through a rigorous purchasing process.


The growth of open-source technologies and cloud-based services means applications are better able to share data than ever before. This connectivity is supported by APIs, allowing applications to seamlessly collect data from disparate warehouse information systems. The information silos that exist in today’s supply chain will vanish in the warehouse of the future thanks to completely integrated technologies.


Along with the connectivity made possible by APIs, the logistics marketplace will be able to take advantage of multi-modal optimization through seamless integration with vendors, logistics providers and other supply chain partners. Multi-modal optimization allows for sophisticated planning across regions, routes, modes of transport and more to easily achieve lead time and cost goals.




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Jungheinrich is a leader in intra logistics solutions. As per current market scenario, we are ready to offer customers with our LI-Ion technology solutions, which help customers to utilize Material-handling equipment to their full extent for a 3-shift operation and increase their throughput. Jungheinrich also offers a fleet management system for large warehouses were customers has a large fleet at one place. This solution supports customers for tracking the utilization of their MHE, live status of the truck, maintenance schedule of the truck and reporting of accidents on time. MANOJIT ACHARYA, MD, JUNGHEINRICH LIFT TRUCK INDIA





Advances in tracking and visibility:


The Internet of Things (IoT) is already shaking up the world of warehousing. IoT fosters better communication and collaboration between supply chain partners, plus greater accountability across the board. IoT adoption will continue to grow over the next decade as technology costs are now within reach for many warehouses and logistics operations. Other benefits of IoT include:


  • The ability to readily identify risks in the supply chain
  • Provides real-time data on weather and other conditions causing shipment delays
  • Helps companies meet chain-of-custody regulations for sensitive cargo
  • Reduces damaged and lost goods, as well as equipment damage
  • Precise location data reduces the time it takes to locate specific inventory
  • Improves inventory management and forecasting accuracy


The IoT is just one of several driving forces behind the trend toward end-to-end supply chain visibility. Another key element is realtime tracking, supported in part by IoT as well as technologies such as RFID and other real-time location systems (RTLS).


Mobility is also playing a significant role in the modern warehouse. The proliferation of mobile devices, such as smartphones and tablets, means warehouse workers and logistics partners have a wealth of tools and resources at their fingertips. Scanning inventory with barcode scanning apps, viewing the precise location of a shipment on a map, pulling up detailed shipping and receiving data and generating reports in seconds are just a few of the many functions made possible by mobile. Thanks to the greater accessibility of technologies required to support it, more warehouses will be achieving end-to-end supply chain visibility over the next decade.





Drones are likely to have a role in the warehouse of the future, as well. In August of 2017, researchers at MIT announced that they had been programming drones to relay RFID as a way to aid in inventory control — an innovation that could make tagging obsolete in the future.


This technology allows small drones to fly above a warehouse floor to read RFID tags from tens of meters away, with an impressive 19-centimeter margin of error. The hope here is that the drones will be able to read existing RFID tags, without the need for the warehouse to purchase new tags, readers or reader software.At the moment, there are a few things holding back drones from becoming part of the warehouse team at all companies, with the chief concern having to do with safety. Current regulations dictate that only a specialized class of lightweight aerial drones can be used in warehouses, but these drones may lack the capabilities needed to accurately read RFID tags from a distance.Within the next several years, industry leaders predict that many warehouses will be able to use drones to track their inventory. This will give warehouses of all sizes the ability to conduct comprehensive inventory counts and audits at the drop of a hat.



Big data and machine learning:


Big data and machine learning aren’t new concepts, but they are poised to transform warehouse operations over the next few years. Artificial intelligence, for instance, can be applied to a number of use cases in the warehouse. Thus, one of the main challenges facing warehouse leaders when it comes to big data and machine learning is to identify key business drivers (or KPIs) and then determine how to best apply AI to improve them.Order accuracy, fulfillment time and inventory accuracy are all KPIs that can be optimized through the use of AI, while some may apply AI to more general drivers such as safety, productivity or facility damage. By analyzing aggregated data from various information systems within the warehouse, AI can be used to automate tasks and decision-making.Advanced analytics, such as predictive analytics, are leveraged to improve forecasting and drive smarter decision-making in the warehouse. Advanced analytics can be applied to use cases such as:

  • Accurate demand forecasting
  • Smarter inventory location planning
  • Clarifying stock demand value
  • Risk reduction, even with more complex supplier networks
  • Rapid response to supply chain issues
  • Manage complexity and demand resulting from new channels
  • Intelligent optimization of picking, storage and more


Advanced analytics can also result in more user-friendly data — that is, data visualizations and other easily digestible formats, making it simpler to derive actionable insights from data. Data visualization, along with advanced analytics, will play a crucial role in achieving end-to-end supply chain visibility discussed earlier in this guide.


Autonomous vehicles:


Autonomous vehicles, once considered a pipe dream, are well within reach for the warehouse of the future. There are a few developments bringing the concept of autonomous vehicles to the warehouse: Platooning is a strategy that utilizes orwardcollision avoidance systems coupled with vehicle-to-vehicle communication that enables two or more trucks to travel in close proximity, resulting in lower wind resistance and fuel economy savings for both vehicles.


The truck at the front of the convoy serves as the leader, while the trucks following adapt and react to changes in the head truck’s movements via technology. While each truck has a driver who remains in complete control of the vehicle, these technology-driven reactions take place with little to no action on the driver’s part. Driver-assisted vehicles aren’t fully autonomous. Instead, a driver-assisted vehicle relies on technology supplemented by the driver, rather than drivers supplemented by technology (known as driver-assist).


Full-autonomous vehicles would operate without the aid of a driver, or with a driver monitoring the vehicle remotely with the ability to take control at any time. In this case, a driver could potentially monitor several vehicles at the same time.



The People -Technology Connection:


One of the striking features of a digitized modern warehouse is the interconnection between people and warehouse technology. This is enabled by wearables. Such technology provides warehouse clerks and managers access to a wide spectrum of information in real time, irrespective of their location, environment, and physical constraints. Wearables are small computers that can be strapped to the wrist, head, or any part of the body. Devices such as smart glasses, augmented reality, and voice-enabled devices are becoming more popular by the day as means of achieving effective interaction with systems. The result will be better flow of information, greater visibility, decrease in error rates, superior safety, and increased service levels at lower operating costs. Wearables can help optimize efficiency in processes such as order picking, receiving, handling, high-value asset handling, cycle counting, safety, and workforce training, to name only a few.



Multi-storey warehousing:


According to JLL research, multi-storey logistics has existed in many parts of Asia for decades, most prevalently in Hong Kong, Japan, and Singapore. Densely populated cities, limited logistics land availability, and relatively high land prices have made multi-storey warehousing necessary developments in these markets. More recently, within the past decade, two to four storey logistics have appeared in top tier Chinese mainland cities, underpinned by activity from global and regional investors.


Multi-storey warehousing is a relatively new concept in Australia. Relatively low land prices historically and abundant availability of land in the outer suburbs of the major cities has limited the  need for multi-storey warehousing, which is typically costlier to construct and maintain. However, rising land values and increasing requirements for urban logistics facilities will likely accelerate the need for multi-storey warehousing in Australia.


This trend will be particularly evident in Sydney, where a number of multi-storey logistics facilities are in development. India may be another market where development of multi-storey warehousing could increase. While there are a number of multi-storey logistics centres in operation currently, none could be considered Grade A. However, an increasing focus from institutional investors and developers on the logistics market may point towards more institutional grade multi-warehousing developments in the years ahead.



Perform and prosper


Looking forward, Imarc Group expects the Indian warehouse market to exhibit moderate growth during 2020-2025. Export/ import cargo which are the key drivers of the warehousing  egment are expected to witness a strong growth in the coming years. According to Imarc, India’s share in the global trade will double in the next five years, creating a positive impact on the warehousing market. Traditional growth driving sectors such as agriculture and manufacturing (textile and auto ancillary) will continue driving the demand in the coming years. A number of new growth drivers such as organized retail, information technology, telecommunications and healthcare are also expected to create a strong demand in the coming years. A significant proportion of investments in warehousing is expected to be made towards free trade warehousing zones (FTWZs) and logistic parks.


It’s not as simple as it may seem to simply adopt the latest technologies for today’s warehouses. In terms of design, existing facilities typically have legacy designs and layouts, so to be successful new automation must be both flexible and minimally disruptive without significant increases in capital expenses. Finally, labor shortages mean that warehouse will look to ways to increase productivity, Automation tools that are simple to use and easy to train workers on and change the nature of the work in order to attract new labor. Warehouses have played an integral role in the supply chain for decades, yet there’s no chance the warehouse will become obsolete. Instead, the future looks bright for the industry as innovative, forward-thinking companies pave the way for the warehouse of the future by embracing the latest advancements in technology.

















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