India urban logistics

Urban logistics spaces in India are expected to exceed 7 million sq. ft by 2022, as demand surges, according to JLL report 'India Urban Logistics - Are dark stores revolutionizing the sector?' The urban logistics industry in India is at a very nascent and on the cusp of going mainstream. Demand will be supported by freight congestion that is impacting cities and communities and the need to mitigate the associated environmental impact of vehicles on these locations.

According to JLL, urban logistics will help address infrastructure, community, and environmental concerns via the efficient movement and transport of goods in urban areas through last-mile storage spaces. Furthermore, urban logistics is expected to expand significantly beyond 2022, as the increasing trend of faster goods distribution and e-commerce penetration increases nationwide.

India urban logistics
“Urban logistics will play a more front-and-centre role in the metropolitan economies of India as consumers become more tethered to the convenience, transparency and hygiene benefits of online purchasing. The surge in e-commerce has led to increased storage space and logistic delivery capabilities, thereby giving owners and developers a clear opportunity to capitalise on the demand, which we believe will easily exceed 7 million sq. ft by 2022,” said Radha Dhir, CEO and Country Head, India, JLL.

“Today, last-mile delivery takes up more than 47% of e-commerce transportation costs. Urban logistics have come in as the perfect bridge to reduce these costs as well as increase delivery efficiency. With increased warehouse and logistics requirements, business models are evolving and creating a vast opportunity for the industrial sector. Furthermore, the shift from retail to urban logistics is generating a change in the demand curve for highly automated and sustainable spaces, encouraging e-commerce and 3PL players to implement micro fulfilment technology to maximise efficiencies and optimise last-mile logistics to boost their businesses,” said Yogesh Shevade, Head – Logistics & industrial, India, JLL.

Dark stores are driving efficiencies, faster delivery capabilities and reducing logistics cost
Dark stores house goods used to fulfil orders placed online, for the last mile connectivity and have the potential of saving anywhere between 10%-30% of logistics costs. Certain wholesale distribution centre businesses are moving towards dark store concepts in India. Since real estate cost in urban locations for logistic activity cannot meet retail rental expectations, dark stores are deemed ideal replacements, as they also serve as cross-dock stores. These can be planned in unused commercial building basements, parking spaces, mall parking, defunct facilities, etc. For grocery business, replenishment to dark stores can be twice or thrice a day, and typical door deliveries will be morning or in the evenings. Some e-commerce players operate daily essentials to enter customer wallets. Hence compliance is not a showstopper.

According to JLL, generally, to handle 1000 Stock Keeping Unit (SKUs), warehouse space can range between 2,000-20,000 sq. ft. depending on product type and Days of Cover (100% inventory cover for number of days). Hence, it is possible to save anywhere between 10%-30% of logistics costs using dark stores.

India urban logistics

The need for greater automation is driving sustainable demand for urban logistics spaces.
Collaborative logistics will also result in a more sustainable urban logistics infrastructure in India, JLL believes. Key initiatives such as vehicle load consolidation, automatic route mapping, data gathering, and analysis, will lead to fewer delivery vehicles on the road and savings on fuel and emissions.

The opportunities with urban logistics in resolving SKU problems are manifold. SKUs are becoming cost-effective real estate alternatives helping companies avoid high traffic areas in cities, serving numerous online stores simultaneously and far more variation per item at a far lower space cost.
Kerala government has planned to build a sports city on an area of 50 acres at an investment of ₹2,000-crore in the Ernakulam district in a phased manner

Read more ...

Tamil Nadu CM has informed that a Tidel Park spreading across five acres areas would be set up in Madurai at an investment of ₹600 crores

Read more ...

In a visionary move, Prime Minister Narendra Modi has launched the National Logistics Policy to improve the competitiveness of Indian goods, enhance

Read more ...

Adani has become India's second largest cement player by acquiring Ambuja Cements & ACC Ltd. Adani family, through their

Read more ...

DHL Supply Chain has planned to invest 500-million Euro amounting to about ₹4,000 crore in India to expand its warehousing capacity, workforce and

Read more ...

The Greater Chennai Corporation (GCC) has decided to build multi-modal transport hubs at two major locations - Guindy and Washermenpet to facilitate the

Read more ...

JSW Steel has collaborated with German-based engineering and technology company SMS group to explore multiple cutting-edge solutions

Read more ...

Mahindra Logistics has unveiled 1 lakh sqft of warehouse in Nashik, designed with a sustainable warehousing architecture including multi-client capabilities

Read more ...

Betolar’s customer FCN has introduced a new innovative technology in its production that can reduce the CO2 emissions of concrete paving blocks and products

Read more ...

KEC International, a global infrastructure Engineering, Procurement and Construction major, has secured new orders worth ₹1,108 crore across its various

Read more ...

The Union Transport Minister Nitin Gadkari has planned to carry out detailed study to introduce skybuses in Bengaluru as it is tough to widen the existing roads

Read more ...

Himachal Pradesh CM Jairam Thakur has launched multiple developmental projects worth ₹148.68 crores in Kangra. The projects include

Read more ...

Informa Markets, India's leading B2B exhibitions organiser, has announced the return of World of Concrete (WOC) India, the leading show in the

Read more ...

As part of the Smart City project in Shimla, five projects of ₹85.23 crore are being executed, including the construction of four

Read more ...

Meghalaya CM has laid the foundation for Phase I of Williamnagar Urban Water Supply Project in East Garo Hills involving ₹121 crore investment under

Read more ...

Riding high on the back of a favorable base effect and improved activities following the relaxation of pandemic-led restrictions, Indian economy recorded

Read more ...

Omaxe Limited has planned to develop multiple construction and infrastructure projects in Dwarka sub city in Southwest Delhi entailing ₹2,100 crore investment

Read more ...

Kerala government has fast tracked the process of building Kochi-Bengaluru Industrial Corridor as the state agencies have already completed the acquisition of

Read more ...

To start work on the twin tower project in Delhi, the public works department (PWD) has initiated the process of finalising financial bid of the architect

Read more ...

Ingka Centres, which is a part of the Ingka Group including IKEA Retail and Ingka Investments, has decided to invest ₹7,500 crore in developing two shopping

Read more ...

×
Sign-up for Free Subscription
'India Construction Week'
Weekly e-Newsletter on Construction Industry
Get the latest news, product launches, projects announced / awarded, government policies, investments, and expert views.