Godrej Material Handling Future-Ready With Predictive Solutions

“There is a perceptible shift towards products with cleaner, greener and smarter technology in the warehouse equipment segment. Data for FY21 shows that electric powered equipment occupies 56% of the MH market share in India”

Anil Lingayat, EVP & Business Head, Godrej Material Handling
Anil Lingayat, EVP & Business Head, Godrej Material Handling

India’s Forklift Market Size
The current demand for forklifts has been driven by the rapid evolution of India’s e-commerce and modern retail sectors. Having said this, Logistics is dependent on lean warehouse operations - independent of the sector. The warehousing industry is currently undergoing a transformation from traditional to modern infrastructure, with an emphasis on productivity and other evolving factors such as quality, consistency assurance, safety and security of goods, efficiency in operations as well as quicker turnarounds. In order to facilitate faster last mile delivery, the warehouses being set up in Tier II & III cities are enabling the growth of material handling equipment in India.

Moreover, the demand for forklifts is largely driven by companies in the Infrastructure sector. This includes steel, cement, electrical cables, tiles, wood, and all the items that go into an infra project, an industrial property or a commercial / residential project. This has picked up considerably over the last few years, and we believe that this demand will sustain and grow. Labour scarcity, job opportunities available in the service sector, and the rising cost of land is driving the demand for forklift trucks in the SME sector.

Despite the sharp fall during the lockdown, India’s forklift industry revived sharply, and is now at the same level as 2019-20 in this fiscal. Given the growth that we have witnessed at Godrej Material Handling (a business of Godrej & Boyce), we are confident that the forklift industry will continue to grow at CAGR of 12-15% for the next 3 years.

Opportunities & Challenges
Most companies saw volatility and uncertainty in demand. Many faced challenges in terms of supply chain disruption, tight liquidity, restricted capex budgets, labour shortage, and spiking commodity costs. While some of these factors created the need for material handling equipment, others made it difficult to set aside budgets for new forklifts. This created an opportunity for the rental business of forklifts. To meet surges, many opted for rental equipment in the short-term because the payback cycle for investing in new equipment was delayed.

One of the major impacts of the pandemic was the shift to online buying. E-Commerce has gained a new, higher level of consumer demand that will persist in the foreseeable future. Another impact was that most industries were affected by a shortage of labour, and today, the need to maintain social distance in the workplace is higher than ever before. Cumulatively, these drove the need to adopt mechanized handling in various forms.

During the pandemic, we also witnessed a significant demand for virtual services and maintenance. Customers showed a preference for remote assistance over video to resolve simpler maintenance issues of their forklifts in order to avoid external personnel visiting their premises.

We, at Godrej Material Handling, sensed this need ahead of time and launched our product manuals on a digital platform, which both our channel partners and customers can easily access. Thanks to this, we were able to provide effective remote assistance to dozens of customers, even during the lockdown.

Technological Advancements
Godrej Bravo Series-3 Wheel Forklift
Due to increase in the number of warehouses, the demand for electric material handling equipment has increased. Industries governed by strict norms such as the F&B and Pharma, were already using electric equipment. However, we have recently seen the increase in demand in other industries for their internal as well as inter-plant movement, thanks to our all-weather electric forklift trucks.

As warehouse operations are growing in scale and complexity, emerging technologies like warehouse trucks for specific tasks, fork trucks integrating with warehouse management systems, etc, are catching on. IoT is another useful tool emerging quite rapidly to monitor fleet health, provide proactive or predictive maintenance, and optimize fleet size. We are offering customers the same through our own IoT enabled product – Godrej Safelog.

Talking about digitalization, the new generation of managers and even forklift operators are more comfortable working with digital manuals, digital training programs, and digital communication platforms. Even large transactions are moving online.

However, there have also been concerns in the area of electric battery powered equipment to respond to user needs like enabling the forklift to run longer hours on a single battery charge, or enabling users to charge batteries at a convenient time, rather than when the battery needs to be charged. We have been able to address these concerns with the introduction of higher capacity batteries that can run for 2-shift operations on a single charge. We are also working on alternate battery technologies to shift to a cleaner and greener future.

Demand for Heavy-Duty Forklifts
Presently, the market for heavy-duty forklift trucks is very small in India. An increase in infrastructure projects and increased activities at ICDs with focus on lower turnaround time will facilitate the growth of heavy diesel forklifts in India.

Addressing Customer Issues
All major international players are present in the Indian market. Competition has grown over a period of time and we expect it to further increase as the material handling industry grows.

Our solutions include a wide range of product offerings, customized maintenance contracts and rental offerings. Our wide reach of 90+ customer touchpoints across the country has been the strength of our core offerings. As a standard practice, we understand the customers’ requirement in detail to recommend solutions best suited to their needs while keeping the Indian context in mind. For example, if a company is setting up a warehouse, we study the racking layout, duty cycle, required throughput, type of handling, and so on.

Based on these parameters, we may recommend either a stacker, forklift, reach truck, articulated forklift, stock-picker or a combination of these products. This will be the customized technical solution. Thereafter, we offer tailor-made service packages and recommend short-term rental trucks to manage annual operational peaks.

We also offer various financing options for our customers through our partners to help address liquidity challenges, if any. In this manner, we offer techno-commercially complete packages that are driven by market requirements.

Godrej’s Material Handling Business
Godrej manufactured India’s first forklift truck in 1963 in technical collaboration with Clark. Over the years, Godrej has continued to introduce the latest technologies; thereby equipping our customers to improve their efficiency, performance and productivity.

Some of our technologies include the AC motor technology, twin traction motor, smart chargers, wet disc brake, and the revolutionary battery technology, to name a few. We recently became the first Indian company to manufacture a 3-wheel electric forklift truck ranging from 1.6 to 2 ton capacity.

We are currently working on alternate battery technologies. IoT is a recent development and while we fit sensors and telemetry devices on our rental fleet equipment, a portfolio of services based on IoT is under development.

Focus on Safety
Enhancing the safety and productivity of forklifts has always been a priority area at Godrej. Our new models come with a host of accessories like red and blue safety lights, camera systems, biometric access systems, operator presence systems, curve speed control, cameras, etc. These help promote safety for the man, machine and material at the customer’s workplace.

The Rental Market For Forklifts in India
As mentioned earlier, various factors that resulted from the pandemic such as supply chain disruption, tight liquidity, restricted capex budgets, labour shortage and spiking commodity costs led to an increased demand for the rental business of forklifts. This is because the payback cycle for investing in new equipment was delayed in the short-term. This trend is expected to continue in the future. As the Indian material handling market matures, we expect equipment finance leasing will also catch up in India. We have already partnered with a leading leasing company in India.

Growth Plans & Strategies
We will continue to introduce new products and services in the market to facilitate our customers to increase their productivity and safety at their workplace. We are coming up with a state-of-the-art manufacturing facility, which will be operational next year.
Lifting & Specialized Transport April-June 2021

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