Modern warehouses have evolved from traditional brick-and-mortar structures built solely for storage purposes to sophisticated infrastructure capable of providing a host of amenities for today’s modern manufacturing businesses. Especially after COVID, it has emerged as a resilient asset class and is expected to reach Rs 2,872.10 Bn by 2027. This can be attributed to several factors, including positive government policies around logistics and development of transport infrastructure. Initiatives like ‘Make in India’, ‘Atmanirbhar Bharat’, and ‘Vocal for Local’ programs launched by the government, have given a boost to manufacturing and impacted the warehousing and logistic sector as well. As a result, the demand for robust warehousing facilities, especially specialty warehousing, subsequently increased. The recently introduced National Logistics Policy (NLP) also contributed to the growth in warehousing as the government aims to strengthen the country’s supply chain with cutting-edge infrastructure.
Warehouses can now handle more complexity and have evolved to become the backbone of the manufacturing sector. From being a vendor to now a partner, warehousing today is helping manufacturers across sectors to optimise their supply chains, create a space for customization and accelerate distribution. Listed below are key developments that have shaped this new partnership and are driving mutual growth.
Agile and dynamic storage solutions:
Modern warehouses offer multi-client storage that can be customised to suit the needs of each client, depending on the product. This also helps warehousing service providers to adapt to changing market conditions and changing needs of their customers. In addition to customised storage solutions, modern warehouses today also act as partners, providing value-added services like kitting, bundling, packaging, order processing, etc. as these services aid in reducing time to market, and help outsource ancillary tasks, thereby focusing on their core competencies. From ambient and temperature-controlled warehouses for storing perishables and pharma to safe and regulated environments for hazardous or inflammable goods like paints, chemicals, and dyes, smart warehouses are offering tailored solutions without a strict structure, allowing manufacturers to alter or regulate their inventory.
Tech enabled solutions for improved efficiency
With improved tech adoption across the logistic and warehousing space, modern storage has become all about automation, real time monitoring, inventory management and smart solutions that bring efficiency in operations. Leveraging AI, ML and IoT, warehouses are using automation for storage and retrieval systems, tracking consignments on real time-basis, route optimisation, ambient and temperature control monitoring, scheduling, labelling, and packaging etc., among other things, that is making a big difference in cutting costs and saving time. Even as more industries embrace the Business 4.0 methodologies for tech driven manufacturing, warehouses are gearing up to be in sync, if not ahead of industries.
Easier access to markets – National and Global
With positive policy support and access to FDI, an increasing number of well-equipped warehouses are now coming up across the country. This is a big change and a boost for manufacturing, which had to earlier depend on storing large volumes at select warehouses, in the outskirts of key markets. Today, warehouses are easily accessible in key strategic locations even for small businesses, thanks to multimodal logistics parks and other infrastructural developments and initiatives encouraged by the government to boost logistics and warehousing operations. The need for reduced delivery timelines has compelled manufacturers to depend on robust storage and distribution centres. The proliferation of warehouses in tier 2 and tier 3 towns across the country has given enough confidence for manufacturers to ensure timely distribution and cater to changing consumer needs and market conditions. Warehouses are now turning into mega fulfilment centres, enabling manufacturers to undertake and finish complex projects seamlessly. It has also made it easier for manufacturers to not only cut time to market for interiors of the country but to also be able to explore newer, international markets.
While warehousing has been developing at a massive speed in the past few years, it has also been instrumental in transforming several traditional methodologies which posed a challenge for 21st century manufacturing. From enhanced efficiency that finally drove better customer experience and higher revenues to creating a network of outsourced partners capable of adding value to the product, vs just acting as vendors, the relationship between the two sectors has evolved to be stronger and complex, at the same time.
Customer expectations concerning customisation are constantly evolving, with a rising need for sophisticated storage systems, compliant facilities, and advanced technical specifications. Given the evolution of warehouses from unorganised godown structures to a prominent asset class, warehousing has emerged to become a major support infrastructure for manufacturing businesses. Investments in warehousing will play a crucial role in upgrading the supply chain and helping the nation reach its goal of a USD 5 Tn economy.