India spends 13-17% of its Gross Domestic Product (GDP) on logistics which is nearly double the logistics cost to GDP ratio in developed nations. Of this, warehousing makes up for nearly 25%. The high cost is a cumulative effect of myriad challenges - from sub-par infrastructure and a lack of synchronization between the storage capacities & the inflow of goods to the lack of skilled labour and a sluggish rate of technology adoption. Also, more than 90% of the warehouses in the country are being operated by unorganised bodies, further trammelling their options to automate the bare minimum warehousing operations.
The silver lining is that in recent years, with pivotal developments like the implementation of GST, growing support for ‘Make in India’ and increase in the volume of global investments and exposure, the Indian warehousing landscape is witnessing major transformations. Leading the pack is a flexible approach to warehousing, enabled by technology.
Flexible Warehousing is akin to an elastic storage setup that adjusts itself according to business fluctuations and seasonal demands. Contrary to a traditional or a contract warehouse, where the entire space, labour, equipment etc. are handed over to a single company for a fixed period, flexible warehousing allows multiple companies to avail the operations & services of the warehouse dynamically as per the demands of their business. This enables shorter contracts with higher flexibility, improved service & efficiency and remarkable cost savings.
Flexible warehousing is swiftly emerging as an effective solution to the many challenges the country’s warehousing industry is facing including high labour & operational costs, reduced availability of prime land sites, increasing growth of last-mile delivery and rapid expansion of e-commerce as a key mode of purchase. It is primarily being steered by continuous technological improvements and investments in AI, thereby facilitating the growth of leaner, accurate and agile supply chain processes.
The adaptability and ease of using flexible warehouses make them the right fit for small, medium, and large manufacturers alike.
In the current times, especially when the world is battling the disruptions caused by the COVID-19 pandemic across all sectors including logistics, flexible manufacturing provides a physical warehouse in the cloud for all.
Cost-effectiveness: With flexible warehousing, companies only pay for the space they use and share resources with others. This means that they can conveniently bring down their warehousing costs and increase their supply chain efficiency as well as profits.
The warehousing market is flooded with various flexible warehousing providers, each with its unique offerings. If you are looking for one, do take note of the following features:
Advancements in technology including newer, hyper-connected facilities with wireless technology and real-time inventory tracking, increased automation and mobility are set to change the face of the industry for the better. These innovations will not only enhance the quality of warehousing but also make it more lucrative.
With a growing number of companies and individuals realising the importance and potential of leaner and more agile supply chain processes, that facilitate the ‘ease of doing business,’ a progressive shift towards the same is being observed. In the years to come, we are likely to witness the emergence and use of smarter technologies and processes shepherding the acceleration of flexible warehousing.
Want to experience the advantages of flexible warehousing for your own business? Get in touch with our experts today. Drop an email to firstname.lastname@example.org or call 0124-2373214.
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