Indian Logistics Sector – Emerging Trends

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The Indian Logistics Market is poised to gather even greater momentum with India’s emergence as a manufacturing hub and upgrading its multimodal transport infrastructure. India has seen a lot of growth in the manufacturing sector recently which is very significant for the growth of the logistics sector. This trend is likely to gather momentum with the gradual revival of the global economy and India emerging as one of the earliest major economies to recover from the downturn.

The rapidly growing industrial sector, coupled with the healthy progress of the agricultural sector, has led to the emergence of extensive supply chains across the country to facilitate the sourcing and distribution of production. The distribution network in India consists of several levels of intermediaries. Organizations are finding it increasingly difficult to work in such a complex marketplace. This prompted many LSPs, experienced in complex logistics operations, to enter and gain a strong foothold in the market.

In addition, the trend of outsourcing logistics activities to organized third party logistics (3PL) is favored by domestic companies as it leaves them free to focus on their core competencies  indian tech blog. Foreign companies doing business in India prefer to outsource all their major logistics needs due to ignorance of local policies, regulations and markets.

Logistics companies are taking to expand across geographic boundaries, a trend that is expected to gain a lot of importance in the years to come. 3PL is expected to increase in the future as collaborating efficiently and strengthening alliances are two factors, which are expected to be seen in the logistics industry. It is noteworthy that specialized companies have excelled in the logistics sector. However, the success of these companies will be determined by how effectively these companies take advantage of the opportunities available to them. The study reveals that logistics capability is related to the firm’s performance in the market, and is not affected by logistics outsourcing. The transportation sector is growing with multimodal transport solutions being prepared and the development of intermodal transport infrastructure facilities

Dedicated cargo corridors by rail and upgrading of coastal shipping facilities along with the construction of large state-of-the-art logistics parks in major distribution centers help meet the specialized warehousing needs of freight forwarders and industry players. Non-main ports are driving traffic growth with traffic at these ports growing at a very healthy rate. This strong growth is expected to continue, with the share of non-main ports increasing.

Technologies like RFID etc help to manage logistics and inventory issues faced by companies. This technology not only benefits the company in its internal operations; its greatest contribution lies in its ability to improve information and material flow throughout the supply chain. The increased visibility and accuracy of the information shared is greatly improved apart from the development of more collaborative relationships across the supply chain.

With the rapid growth in the logistics sector especially 3PL companies, software solutions that meet their various needs have entered the market.

Author: Sarah Sadie