‘Development of sustainable supply chains is the fundamental responsibility of every business’

The Indian logistics sector has demonstrated a gradual recuperation, with projections pointing towards a 10 per cent CAGR between 2022 and 2025. All three modes of transportation — road, sea and air — have exhibited signs of improvement.

Predominantly, road logistics holds a significant position in India, contributing to more than 60 per cent of total freight traffic. Notably, this sector has exhibited the swiftest recovery post Covid, with traffic volumes nearly reaching pre-pandemic levels. Sea logistics has also shown signs of recovery, though not as robust as road logistics due to significant interruptions in the worldwide shipping industry caused by the pandemic and global trade disputes, among other things. Air logistics have encountered a more extended recovery process post Covid. Despite this, the Indian logistics sector stands at the cusp of multiple growth opportunities. The surge of e-commerce and the intricacies of last-mile delivery, coupled with the escalating demands from the service sector, are promising avenues.

The rise of e-commerce is not a new phenomenon, but the pandemic has undoubtedly accelerated it. Customers nowadays expect not only quick deliveries but also quick and simple returns. This change in consumer behaviour causes organisations to relook their strategies and supply chain management, and the technology investments required to meet this demand. This has prompted logistics players and brands to reconsider their strategies. Logistics service providers are required to be more technologically savvy to meet the delivery needs of online retailers at competitive prices. Investment in advanced technologies such as warehouse management systems, automation, and last-mile delivery solutions has become critical to optimize inventory, improve order accuracy, and expedite deliveries. With the evident surge in industry demand, e-commerce undoubtedly takes precedence at Kuehne+Nagel, forming an integral component of our overarching vision to empower our clients in maximising their market opportunities. Our e-commerce services are designed to enhance the 3PL (Third-Party Logistics) value chain, and place special emphasis on catering to the needs of small and medium-sized enterprises. Simultaneously, we are bolstering our customs clearing operations, a facet experiencing significant demand. We are committed to adding value to our customers to the e-commerce supply chain by developing the infrastructure required for geographic expansion, product launches, and sales channel development.

Our Paris Fashion Centre of Excellence is a great illustration of Kuehne+Nagel’s ability to concentrate different expertise with high-added value to meet customers’ needs. It enables businesses to thrive or start their business with customised solutions. It offers a one-of-a-kind network of innovative multimodal transportation solutions, allowing our customers to control costs, delivery times, seasonal changes, and carbon emissions while maintaining a high level of personalisation. Whether the model will be replicated in India depends on our customers’ supply chain needs. We would be happy to support them.

The combination of India’s burgeoning talent pool with the rapidly expanding infrastructural landscape presents us with a remarkable opportunity. With India’s huge array of skilled experts in numerous technology fields, our goal is to build an environment of creativity that propels our digital initiatives to new heights. Through collaboration with local talent, we aspire to create solutions that cater to the evolving demands of both our clients and the broader logistics landscape. The burgeoning infrastructural advancements in India, marked by the expansion of digital networks and logistics systems, provide a fertile ground for the implementation of advanced digital solutions. Seamlessly integrating these innovations into our operations streamlines processes, heightens efficiency, and enriches the overall customer experience. By synergising the expertise of local talent with the evolving infrastructural dynamics, we are well-positioned to drive meaningful progress that seamlessly aligns with our Roadmap 2026, and ultimately, achieving our Vision 2030 of becoming the most trusted supply chain partner supporting a sustainable future.

AI’s ability to process vast amounts of data has revolutionised route optimisation, reduced transit times, and cut fuel costs. Predictive analytics, empowered by AI, has modernised demand forecasting, preventing inventory imbalances. Automation has undergone a remarkable shift through AI. Tasks like inventory tracking and order processing can now be automated, enabling human resources to focus on strategic activities. Robotics and autonomous vehicles, driven by AI, are enhancing warehouse efficiency and last-mile delivery.

In today’s competitive and complex business environment, the development and maintenance of sustainable supply chains is the fundamental responsibility of every business. At Kuehne+Nagel, sustainability is the foundation of everything we do. As part of our efforts, in line with the Science Based Targets initiative (SBTi) and commitment to a low carbon business model, we are continuously developing easy and transparent sustainable shipping options so that our customers have choices of how they can minimise the environmental impact of their shipments. In addition, logistics companies must adopt approaches that result in long-lasting environmental solutions. A prime example is the earnest pursuit of employing alternative, cleaner fuels to drastically curtail carbon emissions. Notably, Sustainable Aviation Fuel (SAF) is a cleaner substitute for conventional jet fuel and a key part of the aviation industry’s plan to reduce carbon emissions in the coming decade. In 2021, Kuehne+Nagel became the first air logistics provider to offer its customers the option to purchase SAF for each shipment, thus reducing carbon emissions.

We use the “book & claim” approach to apply SAF in our customers’ shipments to reduce CO2 emissions generated. After the shipment, we furnish a certificate with a unique number that shows the amount of SAF used and the reduction in CO2 emissions. This certificate also includes all the necessary details to ensure transparency. In India, our customers are already using this model and supporting the environment.

Cross-border logistics involves the movement of goods and resources across international borders. In the context of India, it’s a gateway to harnessing diverse markets and resources that align well with India’s economic ambitions and “Make in India” initiative. Logistics firms are drawn in by the prospect of market expansion, cost reduction, and access to specialised resources, all of which can boost industry competitiveness and resilience. It also opens doors to tap into its burgeoning consumer base, skilled workforce, and expanding infrastructure. At Kuehne+Nagel, we explore new territories to grow our business further and to grow our cross-border network in Asia such as the Indo-Nepal & Indo-Bangladesh trade lanes that facilitate $25b annual trade between BBIN countries. On the flip side, challenges arise from the complexities of diverse regulatory environments, demanding meticulous attention to navigate trade agreements, customs procedures, and compliance issues. Managing logistical intricacies tied to differing infrastructure, languages, and cultural norms requires adept adaptation. Therefore, for businesses to build resilient and sustainable supply chains, they need to have a complete plan that tackles problems head-on while seizing opportunities.

While cross-border logistics open doors to global growth, successful navigation requires a balance of strategic foresight, operational agility, and a comprehensive understanding of the multifaceted landscape. In embracing the complexities and harnessing the opportunities, businesses can build bridges across borders, enabling them to thrive in an interconnected world.