CARGOCONNECT JULY2024 - Flipbook - Page 31
COVERSTORY
WAREHOUSING ADVANCES
the emergence and growth of warehousing
REITs in India,” perceives Vikas.
He elaborates on the potential impacts
and broadening horizons:
* Increased Investment Potential: A
larger Grade A warehousing stock creates
more opportunities for investors to
diversify their portfolios with stable,
long-term assets. Warehousing REITs
can attract capital from both domestic
and international investors seeking
exposure to India’s growing logistics
sector.
* Enhanced Market Liquidity: With
a wider array of Grade A properties
available, market liquidity for warehousing assets is expected to improve. This
increased liquidity facilitates easier
transactions, asset valuation, and portfolio management for REITs, making
them more attractive to investors.
* Rising Demand for Grade A Facilities:
The expansion of e-commerce, 3PL
providers, and organised retail drives
demand for Grade A warehousing facilities. As these sectors grow, the need for
modern, well-equipped warehouses will
escalate, prompting the development of
new Grade A stock.
* Stability and Long-Term Growth:
Factors such as long lease periods and
rent escalation clauses contribute to the
stability of warehousing assets, making
them attractive for REIT investment.
The consistent income generated from
lease agreements provides a reliable
revenue stream for REITs, supporting
steady dividends for investors.
* Infrastructure Development and
Economic Growth: The growth in
Grade A warehousing stock correlates
with infrastructure development and
economic expansion. Improved logistics
infrastructure enhances supply chain
e昀케ciency, stimulates economic activity,
and encourages further investment in
warehousing facilities.
* Geographical Expansion and Sector
Diversi昀椀cation: A broader mix of Grade
A warehousing stock enables geographical expansion into emerging markets and
tier II cities, where demand for modern
logistics facilities is rising. Additionally,
it allows for sector diversi昀椀cation within
REIT portfolios, mitigating risks and
enhancing resilience against market
昀氀uctuations.
Success Factors to
Effectively Pivot Logistics
Warehouses play a critical role in company
operations by organising goods and managing supply chains, whether for dispatching
large-scale raw materials or facilitating
small-scale deliveries. Each dispatch
from the warehouse must be 昀氀awless to
ensure correct delivery. Despite e昀昀orts to
streamline supply chains, warehousing
remains integral. Without proper capacity
planning, companies risk production delays
and market accessibility issues, incurring
substantial costs.
Outsourcing warehousing to 3PL
partners enhances inventory management
through improved visibility and traceability.
This allows manufacturing or retail companies to anticipate inventory shortages due
to high demand or expiry dates, enabling
timely adjustments to mitigate losses and
sustain business continuity. Such decisions are crucial for managing sustainable
operations and impact both inbound and
outbound supply chains, spanning production, distribution, and transportation.
The traditional in-house handling of
operations isn’t always optimal, risking
operational ine昀케ciencies and compromising
core activities’ quality. This approach is
particularly challenging for small e-commerce
businesses lacking resources and larger
enterprises seeking e昀케ciency gains through
logistics outsourcing. Partnering with 3PL
providers enables companies to focus on
growth, marketing, and customer satisfaction
while professionals handle logistics e昀昀ectively.
Sushil Kumar Rathi, Director, Allcargo
Supply Chain – an Allcargo Group Company
couldn’t agree more. He emphasises the
necessity for innovative solutions to address
complex supply chain challenges. “Businesses
now better comprehend market patterns by
utilising technologies like AI-driven forecasting, which use sophisticated ML to predict
future events, and predictive analytics, which
uses data to forecast outcomes. Partnering
Currently, CJ Darcl serves
FMCG, industrial, and
automotive sectors with
warehousing management,
last-mile delivery, and inplant logistics services. Our
in-house WMS, supported
by intra-facility automation,
provides comprehensive
inventory visibility and
seamless integration with
clients’ ERP systems. Our
TMS ensures accuracy and
visibility throughout the doorto-door delivery process,
employing a hub-and-spoke
model. With a robust
transhipment hub and branch
network spanning India, we
optimise network operations,
warehouse design, and
cargo loading, enhancing
operational efficiency and
resource allocation, allowing
us to effectively meet the
evolving needs of its clients.
Nikhil Agarwal
President, CJ Darcl Logistics
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