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Industry Analysis
• Introduction of common GST and taxes has created a favorable environment for logistics
industries and is thus poised for a significant leap forward in years to come
• Growth in Tier 2 and Tier 3 markets with introduction of cheap smartphones and
proliferation of cheaper and faster connectivity of data plans as well as an efficient last
mile delivery has increased the logistics sector in India
• Indian Logistics market is expected to grow at the CAGR of 12.17% by 2022 & Indian
Transport Market is expected to grow at a CAGR of 13.35 % by 2020 driven by the
growth in manufacturing, retail, FMCG and ecommerce sector
• India spends around 14.4 % of its GDP on logistics and Transportation as compared 8%
less by other countries
• Emerging 3PL services: Increased distribution centers, experienced staffs in handling
different picking activities, FIFO stock rotation, SAP warehouse Management Systems,
Using RF for inbound inspection and increases automation has helped to increased this
industry over the following years. 3PL logistics market in India is expected to be worth
US $ 302 Billion by 2020
• Increasing Focus on Regulatory Oversights and Easing trucker/Shipper Responsibilities
• Outsourcing of Freight Data and Payment management
• Using IOT to fix problems in today’s logistics industry like tracking, warehousing
fulfillment, demand prediction and focus on Implementation on the FAST TAG Act
Political Scenario
• Implementation of Tax reforms, GST, demonetization and Lockdown due to corona Virus
has impacted the logistics industry heavily in the last couple of months
• Variation in commodity prices due to political reasons, fuel price variations, oil rates
• Political interferences and instabilities
Economic Scenario
Social Impacts
Technological Impacts
Legal Implications
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Logistics and Supply Chain Industry in India | Arpan Dhar
• Price Discrimination
• Compliance of legal Documents and Contractual Obligations
• Dealing with issues of goods that are restricted in different parts of India
• M&A regulations
Environmental Implications
• Transportation via heavy load vehicles affects Air Quality, Global warming affects, CO2
emission and compliance of BS4/BS6 vehicles
• Negative implications from oil spills, CO2 emissions from warehousing material handling
and transportations
• Introduction of eco friendly vehicles and paper less systems for mode of transportation
Porter’s 5 forces
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Logistics and Supply Chain Industry in India | Arpan Dhar
• Threat from various cargo companies that is entering into the logistics business
like Delhivery, BlackBuck, Rivigo, FirstFlight, ShiftKarado,4TiGo, Shadowfax,
Locus, Lets Transport, QikPod, FreightBro, Porters etc.
• Entry of other international companies like UPS
• Easy access to distribution channels
• Low initial capital investment
• Low entry barriers and easy funding options
• Low consumer switching costs
• Huge growth opportunities in India
e. Threat of substitutes
• Substitutes maybe the transporters who provide services at a cheaper rate
• Negligible product Differentiation
• The product performance of substitute product is same or better
• Low switching costs make the industry price sensitive
Key Takeaways
• Minimum product differentiation and low switching cost give a lot of powers to buyers
• Low entry barriers make the industry very competitive and decrease the scope for
potential profits
• Suppliers have high bargaining powers as they sell via multiple platforms and channels
• Consumers always look for better deals and thus there is no brand loyalty amongst
consumers
• Low cost country, logistics cost in India is higher due to administrative delays
• Prolific or slow penetration of new technology in the SCM process is resulting in
damaged goods
• The most essential challenge faced by the industry today is insufficient integration of
transport networks, information technology and warehousing & distribution facilities.
Regulations exist at a number of different tiers, is imposed by national, regional and
local authorities. However, the regulations differ from city to city, hindering the creation
of national networks.
• Limiting the trucks size and impacting economies of operation
• Increased financial burden on Logistics companies due to Mafia wars, Thieves,
Abduction of freights, Police-Gundaraj, Bribes, Labour Unrest and a gig economy where
the gig workers are unpaid and overly-utilized holds back the industry in India
• However, “Make in India’,” Vocal for Local’, “Atmanirbhar Bharat’, ‘Udaan Schemes’,
“Industrial corridor projects, “Jal Marg Vikas Yojanas”, Multi modal Terminals
Competitors of Edgistify
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