On Demand Warehousing: Solution to Growing Warehousing Cost
The recent market report states that warehouse space leasing has witnessed a growth rate of more than 70% year on year between April 2018 and March 2019. This upsurge in demand can be accredited to many factors like make-in-India initiatives, phenomenal growth rate of tech startups, and technology advancement but e-commerce and GST implementation have by far the greatest impact. While the GST has bought uniformity to the tax regime and simplified the logistic process, growing ecommerce has increased the need for efficient and faster delivery. But without the equivalent increase in supply (The latest reports suggest that the demand has outstripped supply by over a million square feet), the leasing cost may go up eventually.
On Demand warehousing is turning out to be an efficient practice to counter this situation of less supply and high cost. Unlike, traditional leasing practices where a company has to pay an upfront high rent, in On Demand warehousing it only pays for the space and time utilized. This provides companies opportunity to grow their inventory levels and e-commerce fulfillment services in-line with customer demand, helping them to cut down on their storage cost significantly.
There is not an iota of doubt that On Demand Warehousing best suits Startups and SMSE’s as they generally lack the resources and the expertise in inventory management and associating with a 3PL, offering On Demand services, helps them become more efficient in their services at lower cost. However, these services can be of equal use, if not more, to the MNC as it can address their short term requirements during situations of seasonal fluctuations, new product launches and last minute changes.
On Demand Warehousing is for:
- A Business which requires effective scale up of supply chain in-line with customer demand.
- A Business which has limited ability to quickly process orders and manage inventory.
- A Business with seasonal fluctuations and last-minute inventory management.
- A business which has limited budget for warehouses.
Considering, the growing need for these services in the near future and the value that can be added to current practices, we have recently launched our On Demand warehouse services in Goa. We have a General, Bonded warehouse and Cold storage warehouse which are equipped with Forklift and Stacker machinery.