‘COVID has been a catalyst in disguise which helped realigning focus on cold chain thus the logistics sector’ says Pravesh Soni, GM – Business Developement & Executive TA to ‘Managing Director. ‘There is a need to more consented approach specially when we see a big headroom for e-commerce and Industrial and manufacturing growth followed by expected agricultural supply chain revolution. This will increase the complexity multi-fold for the 5 trillion dream. It’s time to pull up all the levers’.
‘Revving back of logistics will be a slow process faced with uncertainty and unpredictability issues to demand-supply stabilization till system reaches equilibrium. Moreover, Heterogeneity will increase due to de-risking of supply chain where in there is divergence from single source and centralization strategy, the suppliers will be spread thin geographically for business continuity purposes leading to reduced MOQ and volumes
‘This will further be aggraverated by agricultural bill implementation where professional engagements will improve the utilization level and reduce wastage of produce to reveal pent-up growth apart from the pace of the shift of supply chain from China and the Industrial growth envisaged for 5 trillion economy in next 5 years’ continued Pravesh.
Mr. Pravesh Soni
GM – Business Developement & Executive TA to ‘Managing Director’
‘As a product professional I have done a number of market researches to have interacted with logistics fleet owners to realize that the key business success factors for them are Turnaround time (TAT), Sweating of assets and the form flexibility, all of which contributes to efficiency. The logistics business is capital intensive and variably thin margin with tight rope walk for the cost arbitrage, the sector is still unorganized to garner even policy and skill-up support in the form it deserves though it accounts for 14% of GDP’ he adds.
The end customer expects faster deliveries in the most reliable manner and for the perishables criticality of TAT can never be emphasized more. Govt initiatives like GST, DFC, Fastag etc. have been conducive to TAT while pressure is equally on commercial vehicle manufacturers too to provide most reliable vehicles to eliminate off-roading. However, there is still enormous room for Infrastructure to be efficient to reduce logistics costs even at the thin unpredictable margins for 90% of logistics players who are small fleet owners. Thus, for these fleet owners, sweating of assets be it the Vehicle or a driver becomes extra-ordinarily critical.
Rivigo, a logistics start-up introduced RaaS (Relay as a service) model in logistics, it is non-stop operation of truck from Kashmir to Kanyakumari by a relay of drivers where truck changes hand at given intervals. While TAT & Costs are primary advantage, it has secondary benefit that even drivers are able to maintain work-life balance and improve their availability.
According to him, ‘The other elements which are continuously building cost pressure is the complexity of fleet management, need for real time tracking & decision making, and cash flow delays. Though majority of fleet owners rely on decade old manual methods, a few have come up harnessing digital capabilities. Either need to deal with complexity or beat the new age competition, the logistics sector has no choice but to leverage digital tools i.e. automation, IoT, block chain, connected vehicle etc. along with analytics & operations research concepts which are still in textbooks for India context. One side the cost of operations and on the other rising assets cost due to BS6 migration will force buying second hand trucks or using the same for longer periods. But upcoming scrap policy could prove to be double whammy for these feet owners’
While digital technology can help amid these headwinds, govt must focus on infrastructure to bring down logistics cost in control. Opening other modes of transport i.e. inland waterways, river transport – Bharatmala, railways with better accessibility/reliability, multimodal connectivity among port/rail/road/Air etc.
And why this!! the Road infra itself has got enormous potential to accommodate the growth of BTKM (Billion-tonne kilo-meter). In the west, the per day km coverage by a truck is 800km while in India it’s just 300-400kms limited by road designs and policies’ he explains. ‘For a simple example, vehicle lengths are limited unlike Germany & developed world where it is uninterrupted operations of A, B, C truck trains on Autobahns facilitating the transport of higher tonnage at higher speeds’, Pravesh summaries
These are permitted in spite of being much longer than 12m as these are full trailers connected one after the other with drawbars. Moreover, drawbars are quite handy in hub & spoke model with quick shunting, reducing time for unloading/loading adding further to TAT.
Areas of interest:-
- New Product Development
- Market Research
- Business Planning & Strategy
- Product Portfolio Planning
- Cost Reduction
- Supplier/Partner Evaluation.
Pravesh Soni can be reached at