Types of challenges Indian logistics companies are facing
Today, logistics industry plays an important role in the Indian economy. It makes uparound 10% of the industry. With the present contribution it has to the ecommerce industry, logistics companies are assisting with storage, package and timely deliveries of products, right at the buyer’s doorstep. Though, things seem to be working in a perfectly streamlined way from far, but logistics companies in India are familiar with quite a few problems.
Here in this article, we will help you in understanding the challenges faced by Indian logistics companies.
Logistics industry is the backbone of every sector’s supply chain. Be it the manufacturing industry, hospitality or healthcare, logistics companies play a major role of connecting the companies to their customers. Even slight delay in reaching the needed medicine to the facility can have serious consequences, while failure to deliver high-value good as per the consumer’s schedule may cause huge loss to both the parties.
So, we can say that in logistics everything is time-bound. All the processes are interconnected and the success of one stage decides the failure and success of the later, because even a slight delay in one stage can have a magnified ripple effect on all the other stages. As a result, today all the logistics organizations are trying to achieve the same target- slashing the time for a supply cycle by streamlining the process efficiently. However, things are not as simple as they seem. Here, we will have a look at some of the challenges faced by logistics companies in India.
High order intensity ratio Huge load of orders is one of the most common issues that Indian logistics company have to face. The need to keep up with the supply chain timeline breaks their back. The high volume of received orders makes it difficult to prioritize orders and deliveries as there is too much to be done in a limited time frame. This becomes even more challenging if the company has limited manpower. Festival and wedding season is the best example of huge orders and mass delays in delivery schedules and an overall failure to the ETA mechanism.
Barriers in transportation India is a huge country with different terrains subjected to different conditions. In the internal parts of the country the condition of roads is not really good, also there are ghats that are prone to landslides and accidents. Other issues where logistics companies lose time and money include, toll stations, multiple checkpoints and traffic congestions. Overall, even if all the extra delays are taken into consideration, there are chances of even more delay.
Slow in making technology updates Countries like Japan follow a more efficient logistics and supply-chain models and their strategies revolve around adapting to the latest technologies for maximum productivity. In India, logistics companies are not so quick in making technology shifts or updates. It may look like they are saving on costs, but this approach can be damaging. It is important that companies consider long run effects of these practices.
Constant surge in fuel costs The ever increasing fuel costs is the biggest problem in transportation prices. The surge in fuel costs lead to increase in surcharge of the shipping tariffs. This further effect the profit to be earned by the company, even causing a major loss to the company in some cases.
Government policies and compliances With compliance obligations being tightened even more, the Indian logistics companies face the challenges of bottlenecks with strict regulations.
How to tackle these challenges for smooth functioning? Companies can take control of their supply chain to reduce the chances of excuses and errors. Let us discuss a few points that will help you in creating and executing better strategies to incorporate in the existing logistics structure.
Flexible processes provide better control Fixed deadlines, put you and your staff under a huge pressure. This may impact the workflow even if it is an easy task. Always keep room for delays when estimating transportation, docking and unloading time.