The Hindu Business Line : Outsourced logistics market to grow at 20 pc: Study

THE market for outsourced logistics in India is likely to grow at over 20 per cent in the coming years as more companies are looking to engage specialist service providers for their logistics requirements, a survey conducted by Frost & Sullivan has said.

The survey, which included interaction with the logistics managers of about 120 companies across different industries, estimated the size of the logistics market at $298.7 million in 2003. The study has identified sectors such as automobiles, pharmaceuticals, metals and textiles as the growth segments for logistics service providers in the coming years.

In another survey by the Transport Corporation of India (TCI) and the Management Development Institute (MDI), it has been revealed that transportation management and inventory management are the two most frequently used components to measure the logistics cost in any organisation. However, warehousing, distribution, packaging and order processing are also emerging as significant components of the logistics market.

Another growing segment is e-logistics. Over 47 per cent of the 130 companies that were surveyed felt that integrating IT systems with traditional logistics services was important. About 57 per cent of the companies have plans to outsource reverse logistics in the next five years, while 54 per cent had plans for outsourcing inventory management and 53 per cent for order processing.

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Outsourced logistics market to grow at 20 pc: Study