The logistics sector provides employment to over 22 million people and has grown at a CAGR of 7.8% during the last five years
The Indian logistics industry has undergone a sea change and now with the infrastructural status, the sector is all set to bank on several opportunities and take risks.
The Economic Survey stated the Indian logistics industry, at present, is worth nearly $160 billion and is expected to touch $215 billion by 2020, growing at a CAGR of 10.5%.
The improving sector, which provides employment to over 22 million people, has grown at a CAGR of 7.8% during the last five years.Moreover, India jumped to 35th rank in 2016 from 54th in 2014 on the global ranking of the World Bank’s Logistics Performance Index 2016. This streak is expected to continue in future as well.
“We at NECC foresee an overall growth in the Indian market, especially in the automobile, textile, pharma and steel sector. We feel that there is a big market potential for logistic sector, waiting to be tapped. We understand that logistics and supply chain play a key role in the development and growth of manufacturing and retail,” said CMD, NECC Group, Sushil Kumar Jain.
With digitization, the industry will witness new technologies and heightened customer expectations in the future. New technologies such as automation, IoT, data analytics, blockchain, etc., will give way to faster shipments with more transparency and reduced prices.
Some companies have already started working in this direction.
“NECC is investing in technological upgradation and developing skilled manpower to meet the client needs and thereby increasing its market share. Our specialised teams are also working on implementing measures to address challenges like, expensive freight carrying cost, high turnaround time for fleet, poor capacity planning, etc.,” said Jain, adding, “we are also upgrading our in-house ERP software and educating our team to meet the new challenges and mechanism.”Through advanced mechanism, the logistics sector will also be able to expand its footprint.
“We feel the need for expanding our network in all potential areas, especially in the North East, Nepal, Bangladesh and Bhutan. Our future plan includes expanding our branch network by 25%. We plan to invest in our fleet strength, sales force to increase market share with the ongoing clients,” said Jain.
Jain said NECC is venturing into developing new routes and markets to generate better yield and high margins. “The company will also increase warehousing and secondary transportation business, which currently is undergoing massive changes after GST in place and logistics sector getting an industrial status,” said Jain.
NECC currently has 250 offices across India, Nepal, Bhutan and Bangladesh. Its current warehousing space of 1.5 million sq. feet includes owned and leased under management facilities. In 2016-17, the company had posted revenues of Rs 548.69 crore as compared to Rs 539.75 crore in 2015-16, up 1.66 per cent.Disclaimer: This article is to create awareness among readers about NECC