Catapulted to the fore in the wake of the pandemic, On-Demand warehousing services have surfaced as the need of the hour, emerging as one of the prime disruptions that has taken the warehousing segment by storm. This feature explores the rise of On-demand warehousing landscape in India and delineates how the warehousing segment can make the most of it.
The coronavirus crisis has led to unprecedented changes and business meltdowns. Operations were crippled, businesses took a backseat.
But the crisis opened the door to new opportunities, new changes that took centre stage as a consequence. The logistics sector is one that has made safer and necessary transitions to accommodate to these changes. From technological advancements to transitioning into resilient models and operations, it has truly withstood its ground despite the severe blow of the pandemic.
The wave of digitalisation, coupled with out-of-the-box innovations have truly redefined this age of the pandemic. The logistics sector is no stranger to these disruptions. One such innovation that has taken the market by storm is the on-demand warehousing space.
On-demand warehousing is an innovative concept that allows customers to access shared warehousing and logistics services on a pay-per-use basis.It is a fulfilment model that is hinged on partnerships between warehouses looking for new merchants and an on-demand warehousing provider surrounded by merchants in need of affordable warehouse space.
The On-demand Delivery Landscape
When we talk about logistics, the importance of last-mile delivery cannot be missed. Delivery is key, and it is now a given that customers must have access to real-time information, such as the product location, or on-demand delivery capacity. In a bid to provide improved and faster delivery services, companies are already partnering with last-mile platforms to pilot express delivery services.
But with the current tide in favour of improved quality at reduced costs, the logistics sector has to draw out plans that can support this drive. There has been a shift towards last-mile delivery will lead to a rise in the local inventory levels and also the demand for an extensive and connected warehousing and distribution network. These are some challenges that specialist last-mile delivery marketplaces may help the bigger logistics players overcome, and this is where On-demand delivery services come into play.
On-demand Delivery services have rapidly become the need of the hour, with emerging businesses facilitating reliable and seamless movement of goods. The objective is to ensure an uninterrupted experience, eradicating any roadblocks on the way.
Yogesh Sarin, Director, Supply Chain, Dell Technologies lends light and thought on the dynamics of on-demand warehousing in the current context.
“The whole concept of on-demand warehousing is based on the enormous merit around the agility it drives. You get an optimal warehousing solution with flexibility of pay per use, utilise infrastructure as may be needed besides a WMS integrated with your ERP to drive optimal supply chain operations for swift business decisions.”~Yogesh Sarin, Director, Supply Chain, Dell Technologies
“The pandemic has further aided as a catalyst to the growth of flexible warehousing and logistic solutions. This is on account of the growing logistics service sector today, with boost from dynamic e commerce consumer demand during long lockdowns, leading the industry to be optimistic about growth at a double digit CAGR”, shares Mr Sarin.
What can on-demand warehousing do?
On-demand warehousing has a myriad of benefits, if implemented properly. The three primary solutions where it is advantageous are: inventory overflow, e-commerce fulfilment and retail distribution.
On-demand warehousing is a lucrative choice to handle surplus inventory or seasonal peaks.It enables one to make capacity additions, as and when required. For retailers and brands reeling under storage issues, it is a welcome choice.
For ecommerce fulfilment, on-demand warehousing allows flexibility to companies to help scale their fulfilment networks as required. This helps brands enhance their direct-to-consumer strategy. This can go a long way in boosting warehousing and fulfilment networks to redefine warehousing, explore new markets, and create short-term product promotions.
Better retail distribution
In addition to ecommerce fulfilment and inventory overflow, on-demand warehousing services may be leveraged by companies looking for better retail distribution experiences. With the help of on-demand services, products can be stored in nearby intake centres, thereby cutting down on last-mile transportation. This can also help in offsetting inventory storage fees.
On-demand operations: Temporary blip or here to stay?
“The trend is here to stay and on demand warehousing is going to continue to be the in thing, as and when and if we get back to normal”, says Naveen Rawat, Director and Co-Founder, Holisol Logistics
Mr Rawat feels that the entire ecosystem has to evolve for on-demand warehousing to grow and prosper.
“Availability of good quality infrastructure would go a long way in helping on-demand warehousing. Though, what is super critical is the technology which can provide visibility of distributed inventory across the network as the customers opt for on-demand warehousing. Along with IT, mechanical automation will allow on-demand warehousing providers to offer a robust, stable, scalable, flexible & efficient warehousing solution.”~Naveen Rawat, Director and Co-Founder, Holisol Logistics
The rise of On-Demand Warehousing in the wake of the pandemic
Sudipt Juneja, Director, Varuna Group believes that the pandemic is driving the need for an on-demand warehousing landscape across the globe.
“The pandemic is driving the need for an on-demand warehousing landscape across the globe. The supply chain teams felt the need for flexibility and agility in their operations leading to an increase in demand for flexible warehousing. This demand is bound to increase in the future as more and more companies begin to save on fixed warehousing costs.”~Sudipt Juneja, Director, Varuna Group
Anamika Jain, Director and Head of Operations, AAJ Enterprises shares more insights on the reasons behind the sudden surge.
“As the pandemic unfolded, businesses had to become agile to ensure business continuity- warehousing service providers helped by offering flexible, on-demand warehousing. With the boom in online retail many businesses require ecommerce supply chain capabilities for catering to new dynamics in both short term as well as efficiently manage the long-term structural shift towards online retail – here again warehouse service providers filled in the gap by offering know how and ready to use ecosystem for ecommerce supplies”, adds Ms Jain.
“It is not possible for businesses anymore to remain entangled in the gut of the traditional processes and their rigidity. Indian 3PL companies have to improve their service levels to match up to new implicit and explicit standards. Flexibility and quality will be the key.”
~Anamika Jain, Director and Head of operations, AAJ Enterprises
This is an abridged version of the article that originally appeared in the July Issue of the Logistics Insider magazine. To read the complete interview, click here.