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52 supply chain management

India’s growing appetite for on-demand
warehousing

warehousing has proven to be a flexible
business model for retailers and brands
offering operational scalability and supply
chain agility.

Businesses can gain substantial cost and
scale benefits by focusing on their core
business activities and outsourcing non-
core business activities like warehousing
to expert solution providers. They are not
required to incur huge expenditures on set-
ting up and maintaining a large warehous-
ing and fulfilment network for inventory
storage and distribution. Leveraging the
on-demand warehousing model enables
companies to fulfil orders when demand is
at peak and scale back when not needed.

With legacies of conventional marketplace model. It taps the power of With a large number of consumers re-
warehousing fulfilments and app-based tools to help customers with gistering their presence on e-commerce
rigid 3PL partnerships rendered warehousing space requirements connect platforms to buy goods and services, there
obsolete, companies are increasingly with logistics players offering excess ware- are rising expectations of one-day or same
evaluating the efficiencies of on-demand housing capacity on a pay-per-use basis. day shipping. On-demand warehousing
warehousing as a cost-effective and flex- By monetising unutilised storage spaces, facilitates decentralised warehousing and
ible business solution. warehousing players are saved the hassle shipping networks near customer locations
of bearing considerable expense on surplus enabling speedy last-mile deliveries within
The COVID-19 pandemic has spurred spaces in on-demand warehousing. stipulated timelines. On-demand ware-
the emergence of a vibrant ‘on-demand’ housing solutions providers offer flexible
economy globally and in India. In layman’s A report by leading property consultant billing, streamlined order fulfilment pro-
terms, it can be described as an economic Knight Frank estimated that warehousing cesses and efficient distribution channels
model leveraging digital technologies to space in India is expected to double over allowing merchants and brands to pursue a
offer access to different services. With the next five years. This will be facilitated robust omni-channel strategy for business
legacies of conventional warehousing by a boom in the e-commerce segment growth and expansion.
fulfilments and rigid 3PL partnerships in the country. The report has stated that
rendered obsolete, companies are in- from 31.7 million sq. feet in 2021, annual Pro-industry government interventions
creasingly evaluating the efficiencies of warehousing transactions in the country like 100 per cent FDI in warehousing
on-demand warehousing as a cost-effective would increase to 76.2 million sq. feet in have placed the industry on a high-growth
and flexible business solution. On the early 2026. Predictions from the report trajectory. This has led to increased fund
demand side it implies the speed at which a further point to the fact that 165 per cent inflows into the sector from domestic
service can be accessed by a customer and additional space in warehouses will be and global institutional investors. In an
on the supply side it implies the efficiency occupied by the e-commerce sector over environment where online is becoming the
at which the service is provided by the the next five years. new offline, on-demand warehousing is
service provider. Speed, scale, access and emerging as a game-changer for the Indian
service efficiency form key parameters The robust growth of the e-commerce warehousing industry. Rising internet
of a seamless and efficient ‘on-demand’ market in India has changed the opera- penetration, tech adaptability, conventional
warehousing model. tional dynamics of conventional logistics. businesses developing online competencies
As customers demand greater transparency and omni-channel retailing have led to the
On-demand warehousing is an online in their buying experience, on-demand creation of a vibrant e-commerce ecosys-
tem in India. The ‘uberisation’ of ware-
housing has the power to position India as
a global e-commerce destination.

Anoop Chauhan
Views are personal. The author is Chief Operating

Officer – Supply Chain, Avvashya CCI Logistics.
Source:www.businesstoday.in

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