Transforming over time from godowns (*1) to warehouses, warehouses have grown to become the backbone of the manufacturing and service industries. Traditionally, warehouses meant humongous spaces managed by a large workforce. There have been businesses that have been solely dependent on managing warehouses. Today, the very nature of handling such space is changing.
With supply chain advancing and evolving over time, warehousing is on a continuous improvement process. The volume of material handling these days, demands use of automation instead of a large workforce. This is to meet the expectations of accuracy and on time delivery. In today's world, speed is everything, it can be your competitive edge.
Specially in the manufacturing industry, with lean manufacturing and lean inventory becoming the aim, having sophisticated material handling systems has become the need of the hour. Similarly, growing consumerism especially with modern retail and ecommerce in particular has led to an ever increasing amount of logistics handling in the service sector, for which proper warehousing stands crucial for survival.
Warehousing in India
Demand for modern and sophisticated warehouses has witnessed a tremendous increase in India in the last few years because of an influx of multinational companies as well as export-oriented companies that are ready to invest in warehousing infrastructure.
Needs for large scale warehousing or dedicated logistics parks are fast catching up in India. The industry is mostly fragmented and unorganized, dominated by many small players. Also, the role of warehouses has increased due to wider product range, emphasis on shorter lead times, and constant changes in customer demand with changing dynamics of the country.
In a recent study done by the World Bank, India jumped 19 positions in the Logistics Performance Index (LPI) which means India is on the growth path as far as the Logistics handling capacity is considered. Also, in 2017, India made the highest ever jump to come within the top 100 countries in the "Ease of Doing Business' index of the World Bank". This indicates that India is becoming a preferred destination for global companies.
Although India is on the path of technological advancement, more needs to be done. Out of the many fields, warehousing and logistics management is one such important field that needs attention. The warehousing industry in India is growing at a rate of 10 percent every year. Considering the current scenario, the growth in the Indian warehouse industry is led by various factors:
- Growth in the manufacturing, engineering, and service industries.
- Growth in e-commerce, modern retail, digitization, and a government thrust towards a cashless economy.
- Growth in domestic consumption.
- Fast growing exports and international trade.
- Growth in private and foreign investments with the Indian government's Make in India Campaign.
- Introduction of GST integrating India into a unified market.
- Increase in trade through foreign investments in the SEZs (Special Economic Zones)
- Growth in openness of the Indian economy and market integration. According to studies, the Indian logistics market is expected to grow at a CAGR of 12.17% by 2020 driven by the growth in the manufacturing, retail, FMCG and e-commerce sectors.
Why Innovating in Warehousing is Crucial?
In today's globalized world the cost of manufacturing a well specified product is pretty much the same anywhere in the world. Then there is the market price which is determined by the consumer base. So with the input and output prices being controlled by external influences, one of the few areas where companies can leverage competitive advantage is their supply chain of which warehousing is a part. As a result, innovation in a warehouse becomes necessary for survival. Some other issues specific to industry and India are as follows:
Labour problems – Labour in India though available in large number as well as cheaply, does have some challenges. Compared to other countries, labour environments in India are less focused on training, which translates into a lack of industry knowledge. Further, there are regulatory issues and often differences between labour unions and company management.
Bulky material – Industries like textile, iron and steel handle huge quantities of bulky material every day. A large workforce is required to handle such huge quantity and managing such a large workforce requires more management and safety is always a concern.
Environment issues – With mass productivity being the prime moto today, industries face problems of space availability and land issues among other challenges. Sometimes challenging environments to work in such cold storage facilities and high-temperature work areas also hinder the productivity of workers. In such cases, replacing man with machines can be a boon.
Solution to Problems of Warehousing
Automation and optimization are key to innovations in warehousing.
Harnessing the power of technology and maximizing a facility's potential can be a competitive edge. This demands companies to improve their warehousing facilities and advance their logistics handling with an efficient supply chain management environment. One such expert in material handling solutions and logistics management is Daifuku.
Daifuku provides its expertise in utilizing the warehouse space optimally with its custom-made solutions. Daifuku's AS/RS helps pace up the movement and use the right amount of space with the least human dependency in a safe way.
Innovations in warehousing will most certainly help achieve improved operating efficiency, cut cycle time, prevent material handling loss and provide controlled access. Daifuku's products such as Unit Load AS/RS, mini load AS/RS and racking systems help deliver speed and efficiency for today's supply chain management (SCM) environment. Daifuku caters to all types of customer needs and designs and builds ensuring high quality and long-term reliability.
*1: Godown: a term used mainly in Southeast and South Asia that means "a place for storing goods".
Daifuku Intralogistics India Pvt. Ltd.
Established in 1986, Daifuku Intralogistics India Pvt. Ltd., formerly known as Vega Conveyors and Automation Private Limited, is a leading provider of automated storage and conveying solutions in the Indian intralogistics market, with 350+ customers served. Employing around 200 people, the company is headquartered near Hyderabad, Telangana with offices in Mumbai and Pune as well.