Major Problems Faced By Logistics Companies In India

Introduction

The importance of logistics in the Indian economy has grown rapidly over the last few decades. In India today, the logistics sector accounts for 10% only of the industry. Logistics companies, with their current contribution to the e-commerce industry, assist with product storage, packaging, and timely delivery right to the customer's door. Everything is time-bound when it comes to logistics. Each process is dependent on the one before it, and a minor delay at one stage has a magnified ripple effect on all the others. By the time we get to the delivery stage, there has been a delay of several days due to a few hours of downtime. Each logistics organization strives for the same goal: to shorten the supply phase by efficiently improving efficiency processes. However, this does not always go as planned, which is to be expected.

Logistics organization is becoming more popular among academics and practitioners because it can lead to lower operational costs, better delivery performance, and higher levels of customer satisfaction. The global logistics industry is valued at USD 300 billion. Despite the fact that the majority of large service providers are headquartered in Europe, the largest market is the United States, which accounts for roughly one-third of the global market. The international freight industry is associated with high operational costs, low profit margins, a scarcity of talent, infrastructure backlogs, client requirement for technology investments and providing one-stop solutions to all of their needs, and consolidation through acquisitions, mergers, and alliances. Logistics sector in India is rapidly evolving, and the interaction of infrastructure, new tech, and new kinds of service providers will determine whether the industry can help its customers reduce transportation cost and provide satisfactory service which are also growing.

Challenges

1. Transport Fetter

Although when packaging and deliveries are completed on time, the transportation industry is frequently unreliable.

India is a vast country with numerous terrains subject to varying conditions.

Internal roads are in poor condition, and the Ghats are prone to accidents and landslides.

Congestion, multiple checkpoints, and toll stations are other issues that cost logistics companies a lot of time and money.

Overall, even after accounting for additional delays, there is still room for further wait.

2. Ratio of High Order Intensity

While attempting to meet the supply-chain timeline, every Indian logistics company has experienced the problem of receiving a bulk load of orders that would break their backs. It becomes challenging to prioritise orders and deliveries while juggling too much with too little time due to the high volume of orders received. Due to the challenging payment cycles, the problem also arises when the business has limited resources. Festival time is the best illustration of widespread delivery schedule delays and a systemic failure of the ETA mechanism, depending on the season.

3. Issues With Ports And Shipping

India's transport businesses incur an unreasonable burden as a result of abnormally long turnaround times for ships as a result of dock congestion and delays in product offloading. Because of poor landside and port infrastructure, as well as insufficient depth at ports, it is difficult to deploy coastal shipping on a big scale in India..

4. Poor infrastructure facilities

The infrastructure in India is not as developed as in other countries. The roads are not properly maintained and there are a lot of potholes on the roads. This becomes a problem for logistics companies that want to transport goods through the country. Traffic is also very high and can cause delays for trucks transporting goods from one place to another. Furthermore, there are many unmanned crossings on highways where truckers have to stop their vehicles and get out to manually close the gates before proceeding. This process takes a lot of time which slows down shipments and is dangerous because drivers may be attacked by thieves or other criminals while they're outside their vehicle unattended.

5. Lack of quality warehousing equipment and a shortage of skilled labour

The logistics industry in India is still relatively immature and there are a number of challenges that companies face. One such challenge is the lack of quality warehousing equipment and skilled labour forces. This has resulted in many successful projects being delayed or stalled, mainly because the required equipment cannot be sourced from the few manufacturers in India. The lack of skilled labour forces is another issue that plagues the sector.

So what’s the Solution?

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