The size of India’s logistics market was estimated to be USD 250 billion in 2021 (Source: Statista). COVID-19 drove e-Commerce and logistics companies in India to adopt new strategies and avenues (e.g., warehouse automation) to ease their storage and transportation problems. The market also witnessed new trends in Indian logistics especially in technology adoption and digitisation (e.g., contactless payments, GPS tracking etc.) to enable logistics service providers stay competitive and in business.

Trends are often the answer to hard pressing issues faced by an industry. Logistics service trends can answer some of most adverse challenges of the Indian logistics service providers like lack of infrastructure, last mile delivery, real-time tracking of vehicles, etc.

In this article, we will have a look at some of the most impactful trends in Indian logistics that will affect how goods transportation and supply chain functions in 2023 and beyond.

Logistics Service Trends 2023 and beyond

Logistics is a dynamic sector and there are rapid changes occurring round the clock. If eCommerce changed consumer buying patterns, it also led to the rise of third-party logistics services (3PLs); if technology optimised vehicle tracking, it also facilitated ease of payments. In brief, over the years, the logistics sector in India has witnessed massive changes – some that have been so core and vital that they are shaping how the sector functions in future.

Listed below are some key trends in logistics services that as a business owner you should know to make informed decisions for your business:

Warehouse automation

Warehousing is an important step in logistics. It involves storing physical inventory in a warehouse until the goods leave for their destination. Therefore, warehousing is a complex task including managing a variety of processes, inventory and distribution of goods. Warehouse automation reduces the complexity of warehousing functions and is designed to speed up these processes. This also reduces logistics costs, contributing to reduced prices for customers.

For example, imagine a distribution center with multiple goods from multiple manufacturers. A team should be assigned to move a particular company’s goods to the shipping area for dispatch. This is where a conveyor system helps. A conveyor system is one of the oldest types of warehouse automation that helps in moving materials around or along assembly lines to work areas such as packaging or sorting.

Here are some of the most popular logistics trends concerning warehousing:

• Automated storage and retrieval systems
• Sortation systems to sort and direct items to separate location within the warehouse like packing station
• Warehouse management systems
• Pick to light systems to track locations of packages easily within a warehouse

Why is warehouse automation a logistic trend for 2023?

Warehouse automation can reduce operating costs and promote accuracy with fewer shipping mistakes.

In India, many businesses prefer to work with third-party logistics service providers (3PLs) to leverage their inventory management, warehousing, and goods transportation systems.

Internet of Things (IoT)

You all know that connectivity matters the most in supply chain and logistics. There should be connectivity in terms of communication and goods tracking. IoT plays a major role in integrating logistics functions for logistics service providers. Location tracking of trucks is one of the most important logistics services. IoT provides location and route management solutions which enable live tracking of vehicles. This helps companies to monitor drivers’ activities and ensure timely delivery of shipments.

Here are some of the applications of IoT in logistics:

• Real time fleet monitoring
• Warehouse management
• Inventory tracking
• Predictive maintenance to prevent vehicle breakdowns
• Radio Frequency Identification (RFID) tags to track individual packages

Why is IoT a logistics trend for 2023?

IoT helps link all the supply chain activities from shipping to last mile delivery.

Multimodal Logistics Parks (MMLP)

The Government of India has stressed on the importance of improving the logistics sector by cutting overall freight costs and time, reducing warehousing costs, decreasing vehicular pollution and congestion, etc., by setting up Multimodal Logistics Parks. The contract to build India’s first Multimodal Logistics Park was recently awarded to Reliance Industries Limited.

A logistics park is a large area dedicated for storage, management, distribution and transportation of various goods. Companies operating from logistics parks will have the necessary infrastructure to assemble, package, process and do light manufacturing of products.

Under the PM Gati Shakti National Master Plan (NMP) of October 2021, the Road Ministry is developing 35 MMLPs, of which 15 MMLPs are to be built in the next three years. Intermodal connectivity and mechanised storage solutions are the key opportunities provided by these parks to businesses.

Benefits of MMLPs:

• Dedicated railway lines, direct connectivity to prominent highways and expressways to ease domestics shipping services and the movement of goods to an airport or a seaport
• Mechanised material handling from warehouse to container terminals
• Space and infrastructure for light manufacturing activities like kitting
• Value-added services including customs clearance, testing facilities and bonded storage yards

Why is Multimodal logistics parks a logistics trend for 2023?

MMLPs is a government initiative to convert large swathes of land into a dedicated space with the necessary infrastructure for logistics companies to foster easy road, rail, water and air connectivity.

Last mile delivery platforms

Last mile delivery is the final step in the logistics process when the product finally reaches the buyer’s doorstep. For businesses, last mile delivery is the most expensive and time-consuming part of the shipping process. Businesses are racing to build new technologies that will solve last mile delivery problems. Most businesses are now looking at integrating a last-mile delivery platform to improve efficiency and customer satisfaction with domestic shipping services.

Businesses are also using Partial Truckload (PTL) services and Less than Truckload (LTL) services to get their products delivered sooner. Partial Truckload and Less than Truckload service providers give you a part of the space for your goods while the rest of the space in the truck is occupied by shipments from other companies. This will allow you to have a wider network coverage region of customers and get your products to the customer at a faster pace.

Transportation Management Systems (TMS)

A transportation management system (TMS) is a software solution that is built to handle all the physical movement of goods of a company. e-Commerce companies and third-party logistics companies widely use this system to fulfill strict time delivery timelines.

TMS solutions are integrated with a business’s cloud or to its ERP software and help handle all aspects of incoming and outgoing transport. This system can also take care of the necessary trade compliance information and documentation needs. Transportation management systems are evolving to facilitate faster query redressals. These systems are being upgraded to include better features and provide businesses with full visibility into their transport operations.

Why is Transportation Management System a logistics trend for 2023?

TMS is a solution capable of provide full visibility into a company’s logistics cycle and is already being widely used in the supply chain and logistics industry.

Following logistics trends to future proof supply chain operations

COVID-19 pandemic kicked off a large boom in demand for door-to-door delivery. Even though logistics companies did try to take on the challenge, there were multiple supply chain disruptions like lack of raw materials and last mile delivery troubles. Many technological innovations including automation, analytics and real time visibility were accelerated after COVID-19 and are all on the list of trends in Indian logistics in 2023.

Logistics companies in India are increasingly recognising the need of organising and automating the supply chain that can overcome any roadblocks. With more customers looking for same day and next day delivery, business will have to find premium logistics partners with wide network coverage and a reliable logistics platform which gives real-time visibility into end-to-end logistics operations.

Logistics aggregator platforms like Tata nexarc’s Logistics can help you select the best logistics partners fitting your business needs at affordable prices.

 

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