A.M. Visvanathan, EVP & Business Head, Godrej Storage Solutions
India’s logistics industry is developing at a rapid pace and has already emerged as the nation’s economic backbone. In fact, the Economic Survey reveals that the logistics industry is estimated to be worth about $160 billion and further propelled by GST introduction, will expectedly reach around $215 billion in the next two years. With current growth pegged at 10.5 percent CAGR, the Indian logistics industry provides employment to more than 22 million people.
Despite its significance, the Indian logistics sector requires massive improvement in terms of transportation, infrastructure, and efficiency. Inadequate transportation, logistics, and warehousing infrastructure, and furthermore, systematic inefficiencies lead to higher logistics costs. This is making Indian goods expensive and unviable in the global marketplace. In fact, the logistics costs in India at 13-14 percent of GDP are much higher as compared to in the United States (9.5 percent) or in Germany (eight percent).
Robotics, automation, and enhanced mechanization could be used to enhance efficiency and reduce operational costs across warehouses nationwide. This possibility is one of the multiple that could be utilized to transform or improve our lives on a daily basis. With revolutionary technological changes happening on a near hourly basis, we have barely scratched the surface.
The role of data analytics will one day allow companies and sellers to accurately predict the purchase patterns of consumers even before the consumers themselves decide. In addition to getting the supply chain strategy right, data analytics will allow logistics companies to predict and plan much before schedule, thereby improving the rate of successful deliveries. Data analytics allows logistics companies to correctly foretell shifts and inventory shortages while guaranteeing revenue and route optimization.
With revolutionary technological changes happening on a near hourly basis, we have barely scratched the surface
In an endeavor to ultimately exchange data in real-time, new-age concepts such as the Internet of Things (IoT) will allow physical devices to be linked to the web and with each other. This linking of devices and sharing of data will allow informed decisions to be taken. For example, the trucks of the future will include an electronic control unit (ECU) or in layman terms, a computer with internal pre-programmed and programmable computer chips that will automatically identify faulty parts or components in case of breakdowns. In addition, through the usage of telematics information about such faulty parts or components will automatically reach the nearest authorized service center so that replacements can be arranged quickly.
The advent of enhanced automation and robotics will allow stakeholders in the logistics and supply-chain industry to opt for such solutions, especially in the warehousing or transportation segment. For example, robotics and automation could allow machines to independently drive material handling equipment in warehouses without human intervention. The loading and unloading of cargo could also be handled through robotics or automation thereby enhancing efficiency levels.
Nascent applications such as virtual logistics or control tower could one day allow the ownership and control of resources in logistics operations to be initiated and executed through the internet or intranet as compared to direct physical control. This allows decision making to be remotely taken up in real-time based on full-fledged information, thereby allowing resources to be optimally utilized. In addition, such real-time decision making reduces downtime in supply-chain since mitigation efforts can be taken up quickly.
One of the most critical cogs of logistics operations is the warehousing segment which is fast transforming from being mere godowns or stocking points to value addition centers. Warehouses have to be adept in handling new-age challenges borne out of product complexity, reduced delivery timelines, and mass customization as per varied specifications. Hence, to avert any operational hiccups and provide value addition— the warehousing industry is adopting technology-centric solutions such as automation, robotics, artificial intelligence, and machine learning. In addition, we are finding enhanced levels of mechanization through increased usage of material handling equipment to ensure efficient operations within modern warehouses.
In conclusion, technology can emerge as an enabler to largely overcome the logistics and warehousing infrastructure inadequacies and other bottlenecks while providing an avenue to provide unhindered growth for the logistics and warehousing industry. Supply chain or logistics function and warehousing function touch the lives of every Indian and hence, any technological adoption or introduction will benefit all stakeholders, especially consumers, thereby improving the lives of millions nationwide.