23-Nov-09 9:00 PM AWST

Opportunities for supply chain efficiency improvements in India

In the recent meltdown, the emphasis to reduce costs and improve efficiencies across sectors has put the spotlight on the supply chain, where there are ample opportunities to value engineer processes.

Logistics costs in India equals 13% of the GDP, which is significantly higher than those of the developed countries, where it equates to only around 10 percent. Even a slightest reduction would result in considerably huge savings for the country says the CII - Jones Lang LaSalle Meghraj report on Transforming Landscapes on Indian Warehousing.

The report was released by Mr Marc Van Peel, Vice Mayor & Chairman of the Port of Antwerp during Logistics conference organised by Confederation of Indian Industry (CII) ‘Moving India Ahead- The Logical way - Vision 2025” in Mumbai.

The report mentions that the emergence of outsourcing along with the consolidation of 3PL players would result in improving efficiencies and lowering costs in the supply chain.

Mr Marc Van Peel said “People perceive investment for improving logistics merely as a burden of external costs. There is a need to create awareness among people with regard to importance of Logistics sector in the economic system. We feel that there is a need to internalize all our external costs and unless we do that the logistics costs would be too big for any country to handle.”

Mr Tushar Jani chairman of CII Western Region Logistics Sub committee & Chairman, Blue Sea Shipping Agency Pvt Ltd affirmed that Logistics or supply chain would be the new mantra in the coming days. He added that there is a need to develop a new kind of confidence on the quality of service where people would start trusting in third party logistics. Today most of the companies rely on their own logistics.

Analyzing the impact of the forthcoming Goods and Services Tax on Logistics, Mr Parind Mehta partner BSR & Company stated that “Petroleum has been kept outside the purview of GST, and that would be a matter of concern to the industry. Ocean and Rail freight are also likely to be taxed.” He further said that “Though the client would be entitled to a credit, there would be an increase in the rate of taxes to 18 to 20 percent. He also pointed out that inter state transfer of stock would be treated at par with sale and would cause a lock up of funds for sometime.”

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Total Comments: 1

vss on 13-Dec-09 11:31 PM (57 days ago) permalink
it is true that if retailers has to gain competitive edge in fastgrowting organised sector it needs to have an efficient supply chain and with outsourcing professional expertise can be called for

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Source: Steelguru

Opportunities for supply chain efficiency improvements in India

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