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The Indian logistics market, which clocked revenues of about $82.1 billion in 2010, reflecting a 9.2 per cent growth over the previous year, is likely to continue on its growth trajectory and touch revenues of $90 billion in 2011.
With different surveys and analysis projecting a market growth of 8-10 per cent over the next few years, it is believed that the logistics industry could notch up revenues of about $ 200 billion by 2020.
But, the moot question haunting logistics users is whether the service providers are adequately gearing up to match their expectations in the years to come.
Two-day event
“The logistics service providers need to improve their capabilities at the earliest.
The Government, on the other hand, should actively focus on improving logistics infrastructure,” says Mr V.G. Ramakrishnan, Frost & Sullivan's Senior Director (Transportation & Logistics), South Asia, Middle-East and North Africa.
This and a host of other issues will be discussed at length during the two-day India Supply Chain Management and Logistics Summit 2011 scheduled in New Delhi from April 28, being organised by Gateway Knowledge Forum, with Frost & Sullivan as the knowledge partner.
A significant trend which will be discussed at the summit, is the anticipated consolidation wave, with even private equity and venture capital firms eying a slice of the logistics sector.
Recent acquisitions
Fedex's acquisition of AFL Logistics and Transport Corporation of India's buying of 51 per cent stake in Infinite Logistics Solutions were some of the significant consolidations that took place in the sector in 2010.
“Companies such as Toll Global Logistics, AllCargo Global Logistics and F H Bertling have been actively seeking to expand their size in India through inorganic growth.
“Even International Finance Corporation (IFC) invested $ 5 million in Snowman Frozen Foods, a Bangalore-based company, and UK's Eredene Capital took 90 per cent stake in MJ Logistics, a 3PL cold storage service provider,” Mr Ramakrishnan pointed out.
Technology solutions
Another topic that will come up for discussion is the quantum of technology solutions being used by service providers to support their operations.
The Indian logistics technology market is set to grow at about 20 per cent in the next five years to cross $ 600 million by 2015, driven primarily by the retail and manufacturing sectors.
“Present solutions are mostly basic inventory management packages and barcode systems.
“Usage of exclusive logistics technologies such as warehouse management system and RFID is significantly low across industry,” Mr Ramakrishnan said.
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