Are you ready to discover the latest trends and innovations in the Indian Warehousing and Logistics Industry? We are excited to announce the upcoming Indian Warehousing & Logistics Exhibition, a must-attend event for all industry professionals and enthusiasts.
With 22 years of experience in the warehousing sector, we know the value of staying informed and connected with industry developments. This exhibition is your golden opportunity to do just that.
🔹 What to Expect:
Explore state-of-the-art warehousing solutions
Gain insights into logistics best practices
Connect with industry experts and thought leaders
Witness the latest technological advancements
Learn about the industry’s progress and future prospects
🔹 Why Attend?
Even if we are not participating, we encourage you to take advantage of this event to expand your knowledge, network with like-minded professionals and discover the latest innovations in warehousing and logistics in India. This is a chance to broaden your horizons and stay up-to-date with industry trends.
Mark your calendars for November 21st, 22nd, and 23rd and head over to the Bombay Exhibition Center for a knowledge-packed experience.
Stay tuned for more updates as the event draws near. Visit the official event website for further details and follow our social media channels for the latest news and updates related to the exhibition & the industry information.
India is one of the fastest-growing economies in the world. Along with a rapidly expanding manufacturing and e-commerce sector. As a result, the demand for warehousing and storage facilities has increased significantly in recent years. However, this blog post, we will discuss the different types of warehousing in India. Mostly focusing on warehousing in Bhiwandi and Mumbai.
The government or private companies operate public warehouse. Basically, they provide storage facilities for multiple businesses. However, they are open to any business or individual looking to store their goods. Public warehouses charge storage fees based on the space used or the duration of storage.
Businesses and corporations operate private warehouse individually to store their own products. However, these warehouses are built and customized to meet the specific storage needs of the company. Private warehouses offer more control and security over the stored goods.
Bonded warehouses are licensed by the government and allow the storage of imported goods without paying customs duties and taxes until they are sold or re-exported. Besides, this is beneficial for importers. Nevertheless who may want to store goods temporarily before they are distributed to the domestic market or exported to other countries.
Cold Storage Warehouses:
Cold storage warehouses are equipped with temperature-controlled environments. Eventually such as fruits, vegetables, dairy products, pharmaceuticals and frozen food. Generally, they help extend the shelf life of these products and maintain their quality.
Distribution centers are large-scale warehouses. Firstly, strategically located to facilitate efficient distribution of goods to various regions. However, they act as intermediaries between manufacturers and retailers, ensuring timely delivery and reduced transportation costs.
Container Freight Stations (CFS):
Container Freight Stations are specialized warehouses situated near ports. They facilitate the stuffing and de-stuffing of cargo containers. Indeed, they help streamline the handling and clearance of import and export shipments.
E-commerce Fulfilment Centre’s:
As online shopping grows in popularity, e-commerce companies require dedicated fulfilment center’s. In order to store, pick, pack and ship products to customers. However, these warehouses are designed to handle a large volume of orders efficiently.
Co-operative warehouses are owned and managed collectively by a group of farmers or producers. However, they provide storage facilities for agricultural products. Also help in marketing and selling the produce at better prices.
Shared space storage is a cost-effective solution for businesses. Additionally they do not require a dedicated space for their inventory. However, in this type of warehousing, multiple businesses share a single warehouse space. Also the cost is divided among them.
Dedicated Space Storage:
Dedicated space storage is ideal for businesses that require a specific area for their inventory. In this type of warehousing, a business rents a dedicated space for their inventory. Also they have complete control over the space.
3PL (third-party logistics) warehousing is a type of warehousing where a third-party logistics provider manages the inventory, storage and distribution of a business’s products. This type of warehousing is ideal for businesses that want to outsource their logistics operations.
Heavy Palletized Warehousing:
Heavy palletized warehouse designed to store heavy and bulky items. This type of warehousing is ideal for businesses that deal with heavy machinery, equipment and raw materials.
Temperature Controlled Warehousing:
Temperature controlled warehousing is a type of warehousing that is designed to store products that require specific temperature conditions. This type of warehousing is ideal for businesses that deal with perishable goods, pharmaceuticals and chemicals.
In addition to warehousing, many companies in India also offer storage and distribution services. These services include:
Home Cargo Storage:
Home cargo storage is a service that allows individuals to store their household items in a secure warehouse. This service is ideal for individuals who are moving to a new home or renovating their existing home.
Commercial Cargo Storage:
Commercial cargo storage is a service that allows businesses to store their inventory in a secure warehouse. This service is ideal for businesses that need extra space for their inventory.
Packers & Movers Storage:
Packers & movers storage is a service that allows individuals and businesses to store their items. Primarily, they moved from one location to another. This service is ideal for individuals and businesses that are relocating.
PAN India Distribution
Many warehousing and logistics companies in India offer PAN India distribution services. This means that they have a network of warehouses and distribution center’s across the country. Allowing them to deliver products to any part of India.
Bhiwandi and Mumbai are two of the most important warehousing hubs in India. Bhiwandi is located on the outskirts of Mumbai. It is home to many warehouses that cater to the e-commerce and retail sectors. On the other hand, Mumbai, is a major port city. It is home to many warehouses that cater to the export and import sectors.
In conclusion, warehousing in India has evolved significantly in recent years. Indeed, with many companies offering a wide range of warehousing, storage and distribution services. Whether you are a small business or a large corporation, a warehousing solution can meet your needs. So, if you are looking for warehousing in Bhiwandi or Mumbai, or any other part of India. However, make sure to do your research and choose a company that can provide you with the services you need.
Fresh investments, supply, and interest are propelling the Indian logistics industry to the next level. India’s Logistics Performance Index ranking has slipped from 35th in the World Bank’s 2016 study. However, the introduction of GST and substantial investments from global players will significantly boost the sector’s growth.
Interestingly, logistics in the Asia Pacific region is performing well. In comparison to other global counterparts according to the 2016 World Bank survey on trade logistics. Singapore, Hong Kong & Japan are top of global league of 160 countries in terms of logistics performance, alongside markets in Europe and the United States.
Based on JLL estimates, the total amount of stock in seven largest logistics markets in the region. Currently totals more than 1.5 billion sqm (gross floor area), double the size of the 795 million sqm. United States and significantly more than the 260 million sqm in Europe. However, it is more appropriate to look at logistics stock at a local level, as regional economies are at vastly different stages of development.
India’s warehousing sector experienced a 20% CAGR from 2014 to 2017, driven by economic revival, e-commerce and third-party logistics growth, and GST implementation. Therefore, existing stock can grow faster until 2022. Investment in infrastructure is also expected to play a significant role, as large planned investments. Such as MMLPs, dedicated freight corridors (DFC), etc. In road, rails, ports and airways across emerging India will bolster trade – and, consequently, warehousing demand.
Maharashtra’s Logistics Industry and the Impact of GST
The Maharashtra government is all set to release a comprehensive logistics policy in a bid to develop the state as a logistics hub and promote port led development. The government hopes that the goods and services tax (GST) regime will come handy in boosting the logistics sector considering state’s strategic and geographic location. Currently, manufacture logistics and construction collectively contribute 35% to the state gross domestic product and the government hopes to increase that share till 2022.
Chief Minister Devendra Fadnavis, in an investor meeting, noted that due to Nagpur’s central location and the GST, it can now become a gateway for goods in the state. He also mentioned that with the Mumbai-Nagpur Super Communication Expressway and 22 cargo processing centers. 70% cargo distribution from the Jawaharlal Nehru Port can expand to 24 districts beyond Mumbai, Thane, and Pune.
Sushil Jiwarajka, president, Infrastructure & Logistics Federation of India, said logistics will become a crucial factor in the growth of economy with the onset of GST. In Maharashtra, Nagpur’s central location makes it a potential logistics hub for nationwide distribution by major companies. Also, the Mumbai-Nagpur Super Communication Expressway will create a key linkage for goods from the hinterland to the ports on the west coast. He, however, suggested that the policy should provide fiscal incentives including tax holidays and allotment of land at reasonable rates.
K V Mahiddhar, head of CII Institute of Logistics, said states are preparing policies to incentivise logistics sector. ”States are also focusing on further strengthening transport infrastructure and connectivity, develop warehousing and cold chains to improve overall logistics. Under the GST regime, the investors, especially from the logistics sector, will make investments based on business requirements,” he said.
The Central government introduced a programme to speed up delivery. Cargo containers to importers/consignees to check extra cost and time involved in the clearances by introducing. So-called direct port delivery (DPD) scheme at the Jawaharlal Nehru Port and Chennai Port, spurred by a report from the World Bank on ease of doing business.
How DPD Works
DPD allows importers/consignees to take delivery of the containers directly from the port terminals and haul them to factories without taking them first to a CFS and from there to factories. An importer has thus assured clearance of cargo in less than 48 hours under DPD as against an average of seven days if routed through a CFS.
The Role of Container Freight Stations (CFS)
The Customs Department licenses an off-dock facility, known as a CFS, to ease port congestion by relocating containerized cargo and conducting customs-related activities outside the port area. Due to Customs procedures and space constraints at many of India’s ports, Customs clearance happens at the CFS.
JNPT was designed on the CFS model. In late 2016, the government directed JNPT and Customs to raise the proportion of DPD first from 3 % to 40 % and later to 70 %.
DPD Advantage or Disadvantage?
Top logistics firms, including listed entities that have invested thousands of crores to set up and run container freight stations (CFSs) near India’s container ports, face an uncertain future. Firms such as All cargo Logistics Ltd, Navkar Corporation Ltd, Gateway Distriparks Ltd, Container Corporation of India Ltd (Concor) and Balmer & Lawrie Co Ltd are among the 33 CFSs operating near JNPT. In fact, Navkar went public in 2015 purely on the strength of its CFS business.
Most of the stakeholders in the export-import logistics chain say that the DPD is an excellent concept. But are critical of the way it is being implemented, mainly because it will hurt their business. The government has targeted CFSs to fasten import clearances because this intermediary, it feels, takes the longest time, as much as 8-9 days, in completing all procedures. The long cargo dwell time in CFSs automatically adds to transaction costs, says the government. CFS operators say that the longer dwell time attributed to them is not of their own making. “Importers prefer to keep containers in the CFSs and move them to factories according to their inventory requirements. CFS is the safest and cheapest way of storing containers,” says a CFS executive.
Impact on CFS Business
There are some 33 CFSs in Nhava Sheva and another 150 across India. “What’s going to happen to the CFS business, which has seen some ₹10,000 crore investment as a sector generating employment of a couple of lakhs? The government is saying that CFSs are bad and overnight they have to change. It’s become a completely unviable model. So, what do you do with it? How do you re-engineer? Has the government given that a thought,” asks a CFS operator.
Challenges and Concerns
On its part, the government wants CFSs to transform into modern warehouses for doing value-added services, which the CFS industry says would require more floor space index (FSI). ”We don’t have the FSI for it,” said the chief executive of a privately run CFS in JNPT area. CFSs, mostly large yards for stacking containers, have a FSI of 0.3 or 0.4. Will the government permit us to have more FSI? Will we be treated again as a sunrise sector by offering tax breaks. So that we can re-invent our business model from scratch or should we become terminally sick,” he asked.
According to a report by CBRE the leasing of industrial and warehousing space rose 50 per cent in January-June at 7.3 million sq ft in eight cities and absorption may touch an all-time high in 2017 on positive sentiments after GST rollout. The report further says that the companies from third party logistics, engineering, manufacturing and FMCG sectors contributed about 75 per cent of the leasing. Leasing activities grew in all sectors except pharma, which absorbed 20 per cent less space in the first half of 2017 as compared to the second half of 2016.
Bengaluru, Delhi-NCR and Chennai were the preferred markets for leasing space. Mumbai’s share was 13 per cent of the total leasing in first half of 2017, while Kolkata, Ahmedabad, Hyderabad and Pune constituted 23 per cent of the demand. “The leasing activity continued to witness strong growth during the first half of 2017, as close to 7.3 million sq ft was leased across cities. The transaction activity grew by almost 50 per cent when compared to H2 2016,” CBRE said.
Among the prominent deals during January-June period, LP Logistics leased about 2 lakh sq ft in Bhiwandi, Mumbai, Honda Two-Wheelers 1.9 lakh sq ft in Bengaluru, HUL 1.8 lakh sq ft in Delhi-NCR and P&G 2 lakh sq ft in Chennai. CBRE Chairman India and South East Asia Anshuman Magazine said the country’s growing economy has helped in increased activities in industrial and warehousing segment over the past few years. “The sustained growth of the segment, coupled with the implementation of the landmark Goods and Services Tax (from July 1), will result in efficient supply chains and lower compliance costs, the benefits of which will eventually trickle down to make the reform a much needed incentive for businesses in India,” he said.
The deal size rose to 65,000 sq ft during January-June 2017 from about 50,000 sq ft in second half of 2016. The number of transaction above 2 lakh sq ft also doubled during the period under review. “Sustained demand coupled with limited quality supply led to a steep appreciation in rentals (11-13 per cent) in micro- markets like Ghaziabad, Kundli/Murthal in Delhi-NCR, western corridors of Hyderabad and Bhiwandi in Mumbai,” the report said, adding that rentals dipped in Chennai on higher supply. The consultant projected that rentals in select micro- markets would rise on strong demand.
The Union government on Wednesday confirmed that one of the terminals at the Jawaharlal Nehru Port Trust (JNPT) near Mumbai has been impacted by the latest malware attack.
Officials said the attack has affected all software operations of Gateway Terminal India (GTI). Danish shipping giant AP Moller-Maersk, one of the affected entities globally, operates the GTI, which has a capacity to handle 1.8 million standard container units.
It is anticipated that there could be bunching of in-bound and out-bound container cargo and the Ministry of Shipping and the JNPT were taking steps to ensure minimum disturbance to trade, transporters and more importantly local citizens.
“In reality, nothing could be done manually in that system. You have two options, either work with software or stop it. Thus because of this attack, virtually no work is being conducted at GTI since last night. This attack will have a worldwide impact as thousands of companies from across the globe send and receive containers from this terminal,” the official said.
Maritime conglomerate Maersk group confirmed that its operations were hit by the cyber attack. “We can confirm that on Tuesday, June 27, AP Moller-Maersk was hit as part of a cyber attack named Petya, affecting multiple sites and select business units,” Maersk said in a tweet.
It said, “We are responding to the situation to contain and limit the impact and uphold operations.”
The group is “assessing and managing” the situation to minimise the impact on its customers and partners.