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Challenges Logistics Industry Faced During The Pandemic

Logisticians have been working relentlessly through the pandemic to ensure that customers receive their shipments on time and the rise in demand for essentials and non-essentials are met.

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Overview:

‘When it rains, it pours’ may never have been more apropos and prophetic than it is today. The coronavirus pandemic occurred at a time when the world was already experiencing a challenging global scenario with rising trade barriers, geopolitical tensions, climate-related worries and subdued economic activities. India’s economy grew at 7.0% and 6.1% in fiscal 2017-18 and 2018-19 respectively. While the GDP growth rate was 4.2% in 2019-2020, Nomura has estimated the GDP to be in the negative territory at -6.1% for FY 2020-21.

The pandemic saw an immense shift in the ways business restructured operations and steered themselves through the multifaceted challenges. In the midst of all this, the logistics industry played an imperative and impressive role in strengthening India’s supply chain and infrastructure, while also supporting the critical sectors of the economy by being on the fore during the pandemic. The industry has been instrumental in ensuring that the global and national flow of goods particularly essential items, is unhindered despite the lack of sufficient transport and other disruptions in the supply chain.

Challenges:

Logisticians have been working relentlessly through the pandemic to ensure that customers receive their shipments on time and the rise in demand for essentials and non-essentials are met. With people becoming increasingly dependent on e-commerce to meet both essential and non-essential supply needs, the sector has witnessed a huge surge in demand. While this has put the spotlight on the key role logistics plays in our economy, there is unprecedented pressure to scale up and increase efficiency while optimizing costs.

The lockdown imposed in India during the start of COVID 19 in the country dislocated the supply chain for essential and non- essential items. The complete shutdown of the movement of goods and people created challenges. This was further intensified with the partial opening of the lockdown which saw movement of the migrant labor force from cities creating a void in the labour market. Social distancing, safety, and hygiene checks that weren’t prevalent before have become imperative for daily operations.

The most important test for the industry was to get the entire logistics operation acclimated to the new normal of operating including contactless delivery. As air express cargo continued to function, it was being deployed for movement of essentials and medical supplies as well as non-essential commodities wherever regulatory authorized.

The application of technology and digitization being still at a nascent stage in India, only a handful of logistics players with a market advantage in technology were able to exploit the opportunity to the most of its potential. While many companies understood the requirement for resilience and automation adaption in the current environment, a number of them are still trying to bridge the gap.

Looking forward:

The solution to a majority of the hurdles faced, lies in embracing and using technology and automation to our advantage. Technology has become the backbone of not just the logistics industry, but of almost every industry across the world. Modern supply chain will include lean operators who are able to ramp up and achieve high service levels at short notice. I believe, a big advantage for India is the resources we possess as well as the sheer talent of skilled manpower. This makes it a great landscape to find a balance between Artificial Intelligence and Augmented Intelligence.

The logistics industry is experiencing the adaption of technology across the chain from first mile to last mile. A future outlook to me, for the industry, seems to be a space where faster results can be expected without compromising on quality. Technological leaps such as real-time ordering, end-to-end inventory visibility, autonomous warehouses and hubs, drone delivery and a significant use of robotics is what we can expect in the foreseeable future. The idea is to use manpower for more complex and rewarding tasks thereby increasing efficiency and effectiveness of the entire manpower and tech combination. An indigenous network modelling system needs to be developed and implemented to dynamically respond to changes in network schedules and recommend fast and reliable network routes linking shipment origins with destinations.

The logistics express industry is extremely customer centric. Hence, enhancing customer experience is also what will set companies apart in a very competitive environment.

The Government too is taking a number of steps to ensure that the logistics industry operates efficiently and optimally. Various initiatives such as ‘Make in India’ and ‘Vocal for Local’ have been introduced, to give impetus to the domestic manufacturing industry which will directly and indirectly have a bearing on logisticians.

To sum it up, I would say that the ability to continue ‘business as usual,’ in the wake of another pandemic or disaster is something we have to normalize and adapt to. Dynamic Leadership will play a crucial role as the leaders of the organization will be responsible in steering the path to success. All this will truly help India emerge as a nerve center of the Modern Supply Chain in a Post COVID world.

Disclaimer: The views expressed in the article above are those of the authors' and do not necessarily represent or reflect the views of this publishing house. Unless otherwise noted, the author is writing in his/her personal capacity. They are not intended and should not be thought to represent official ideas, attitudes, or policies of any agency or institution.


Tags assigned to this article:
Logistics Industry gdp COVID-19 lockdown india economy

Ketan Kulkarni

CMO & Head – Business Development, Blue Dart

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