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The warehousing market in India was valued at INR 1,050 billion in 2020 and is now expected to grow at a CAGR of 15% till 2025.
From being mere weather proof storage for goods of all kinds, warehouses today are hubs of innovation, both in terms of technology and evolution of the business model itself.
Trends Dominating Warehousing
- More than ever before, consumers are making buying decisions based on delivery speed. Shiprocket, which currently operates out of 13 warehouses across India sees the need to set up 400-500 smaller, city-centric warehouses to accelerate the speed of delivery.
- On-demand warehousing is in, meaning outsourcing of operations will be the new normal – to reduce costs, brands will choose not to own warehouses separately. Instead they will opt for custom sized storage and distribution services.
- Technology is now at the forefront of integration. Ecommerce firms today are using multiple warehousing services and the challenge is to integrate all the warehouses on a single platform to enable visibility across multiple locations and cut costs.
- With new sectors like home decor, pharmaceuticals, FMCG, beauty, and personal care coming into prominence, there is a need for more comprehensive solutions to solve sector-specific problems.
- Warehousing users are increasingly adopting a hybrid model - which means leveraging fulfillment providers as well as creating their own supply chain based on geography and demography.
- Warehousing is a compelling option for portfolios today and has received a record INR 5,500 crore from investors in Q2, 2021 - the most active quarter for the sector since 2018-19.