Strategic Challenges Faced By Warehousing Sector in India
In spite of the fact that warehouses in India are the strategic backbone of the country and present a pool of opportunities before it, the challenges faced by it are plenty. While some are strategic challenges others are operational challenges which need to be managed regularly.
Here is an overview of strategic challenges which are faced by the warehousing sector in the country:
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-Infrastructure
True that with the advent of manufacturing and logistics space, infrastructure has improved effectively. However this advent hasn’t touched a larger section of the warehousing industry. An efficient warehousing system relies heavily on the high-quality of infrastructure which also includes a good mode of connectivity. The most primary concern is that the transport network in the country is unorganized and is dominated by small players, leaving a little scope for improvement.
-Power Outage
The biggest problem with cold chain is that it has severe power outage problem. Leading to a great amount of wastage of agricultural products annually, it is hitting the economic and agricultural sufficiency of the country adversely. On the other hand increasing cost of power leads makes it unaffordable.
-Complex Tax Routine
The delay which is observed in implementation of GST and the current sales and transport tax system has made it almost impossible to establish nation-wide standard distribution hub. The kind of centralised hubs which are seen in developed regions of the world.
-High cost incurred due to long transit time
Longer duration of transit and lack of adequate infrastructure also adds to the transportation cost in totality. This process leads to collection of the products in mini-warehouses defeating the basic purpose of augmentation and transportation.
-Fragmented Market along with unorganized players
The full potential of economy can’t be fully realized because the warehouses in India are dominated by small players having small capacity. In this light cold-chain logistics are always driven by consolidation all over the world. In the absence of the market with small capacity cold- storages can’t be maintained.
For more details please check www.indospace.in/.
Here is an overview of strategic challenges which are faced by the warehousing sector in the country:
True that with the advent of manufacturing and logistics space, infrastructure has improved effectively. However this advent hasn’t touched a larger section of the warehousing industry. An efficient warehousing system relies heavily on the high-quality of infrastructure which also includes a good mode of connectivity. The most primary concern is that the transport network in the country is unorganized and is dominated by small players, leaving a little scope for improvement.
-Power Outage
The biggest problem with cold chain is that it has severe power outage problem. Leading to a great amount of wastage of agricultural products annually, it is hitting the economic and agricultural sufficiency of the country adversely. On the other hand increasing cost of power leads makes it unaffordable.
-Complex Tax Routine
The delay which is observed in implementation of GST and the current sales and transport tax system has made it almost impossible to establish nation-wide standard distribution hub. The kind of centralised hubs which are seen in developed regions of the world.
-High cost incurred due to long transit time
Longer duration of transit and lack of adequate infrastructure also adds to the transportation cost in totality. This process leads to collection of the products in mini-warehouses defeating the basic purpose of augmentation and transportation.
-Fragmented Market along with unorganized players
The full potential of economy can’t be fully realized because the warehouses in India are dominated by small players having small capacity. In this light cold-chain logistics are always driven by consolidation all over the world. In the absence of the market with small capacity cold- storages can’t be maintained.
For more details please check www.indospace.in/.
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