Strategies Adopted By The Supply Chain And Logistics Industry To Create Competitive Advancement

Rubal Jain, Managing Director, SafexpressA Bachelor of Science in Operations Research from Columbia University, New York and MBA from Stanford University's Graduate School of Business, Rubal is an active member of Entrepreneur's Organization, and currently serves on the board of EO New Delhi Chapter

The logistics and supply chain industry in India has come a long way in the last five years and major transformations in the country, such as the rapid rise of e-Commerce and steady transformation of India’s digital infrastructure have led to an increased demand for warehousing in the country. Favorable investment regulations is further adding strength to the development pace and making the deployment of funds a loT easier than it used to be in the past. With high demand for quality logistics facilities and increasing market maturity, there exists a huge potential in the logistics and supply chain sector, and the space is set to grow from this stage. This immense growth potential has encouraged the government to frame a dedicated IT backbone for the industry which will further accelerate the move towards making the industry more organized.

India’s Supply Chain Network First Movers to Benefit from Industry Reforms
Strategic planning and innovation is at the core of any business these days, especially when it comes to supply chain and logistics. The logistics industry remains a key focus of government spending and infrastructure investments a colossal challenge, but also an attractive opportunity for first movers to gain from India’s developing supply chain ecosystem. With improved participation from the private sector and increased government spending, there exists substantial opportunities for partnership with foreigninvestors who can benefit from collaborations with established Indian firms in the sector. Investors and companies can avail much needed incentives and remodel their supply chain networks, leading to a more consolidated supplychain landscape in the country.

Charting a New Course in the Post GST ERA
The advent of GST along with
increased government spending, infrastructure improvements, focus on up skilling workforce and large scale initiatives like ‘Make in India’ has helped remove the challenges relating to logistics & supply chain management, facilitating operators in the space to expand across the country. It has also paved the way for a more organized logistics sector and improved India’s ranking(54 in 2014, 44 in 2018) in the Logistics Performance Index(LPI) accorded by World Bank, with respect to overall logistics performance. With the implementation of GST, there is now an incentive for customers to switch to organized logistics players to claim GST refunds on time, and as such, organized logistic companies have a huge competitive advantage over small, unorganized transporters operating informally. As per reports, GST is expected to drive India’s logistics industry from $160 billion in 2019 to $215 billion by next year.

The logistics industry remains a key focus of government spending and infrastructure investments- a colossal challenge, but also an attractive opportunity for first movers to gain from India's developing supply chain ecosystem

While GST did take its own time to become a reality, Safexpress was ahead of time in creating an unparalleled logistics network spanning every square inch of the country, and developing 45 ultra-modern Logistics Parks across key industrial hubs and strategically positioned at the major National Highways. With the rolling-over of GST two years back, these Logistics Parks are helping innumerable business enterprises by creating new supply chain models for them and boosting their operational efficiencies significantly. With several more Logistics Parks in the pipeline, Safexpress is very well positioned to address the recent increase in demand for world-class supply chain management and logistics services.

The Big Push through Digital Transformation
The government is actively supporting the growth and streamlining of the Indian logistics sector in the country, which as per an article published by the NITI Aayog, is deemed a sunshine industry. According to ICRA, the Indian logistics sector has advanced at a CAGR of almost eight percent over the last five years. It is expected to extend employment to over 40 million people by 2020, compared to 22 million people at present. The industry is witnessing a phase of transformation, with a push to emerging technology trends, increased efficiency and automation that will further enable the sector to modernize. It will be no surprise if the logistics sector emerges as the largest job creator by 2025.

There is no other industry where so many industry experts ascribe a high importance to data and analytics in the next 5-10 years than transportation and logistics close to 90 percent compared to an average of 83 percent. As new technologies emerge, it is significantly changing the way goods are received, stored and shipped in a warehouse and transforming the supply chain & logistics industry beyond what is currently known. With better connectivity, supply chains have benefited on every area of their business, including finance, customer support, sales & marketing and operations, giving a definitive shape to the idea of IoE (Internet of Everything) where People, Process and Data along with Things have created an incredible ecosystem that drives value and enables logistics businesses to fasttrack automation.