Importance Of In-City Warehouses In Ecommerce Businesses?

There has never been a more exciting time in India for e-commerce enterprises than today. The sector, which is already in the top 10 in the world in terms of sales, is barely saturated. As a result, there is significant room for expansion in scale and penetration, which is not surprising for the world’s second-largest consumer market. What is unexpected, though, is the rate at which the industry matures, with customers increasingly prioritizing convenience above value when making purchasing decisions. 

This tendency can be seen in the rapidly growing fast commerce market, which is predicted to grow 15 times its present size in less than five years. As a result, in-city warehouses, important facilitators of rapid commerce and other convenience-centric retail models, are experiencing record demand and will continue to do so for various causes in the future years of a logistics park in India.

Increase In The Frequency Of Internet Purchases

To suggest that pandemic-induced lockdowns accelerated the internet purchase trend would be an understatement. The epidemic has accelerated the expansion of e-commerce, causing customers globally to shop online more frequently than previously. India’s e-commerce business has more than quadrupled last year, rising from $30 billion to $84 billion. The number is predicted to double in less than a decade, increasing the demand for storage and distribution hubs. The rising number of items bought online by consumers has raised the need for storage space, with in-city warehouses emerging as the most recent frontier for development. The conversion of brick-and-mortar shopping areas into e-commerce fulfillment centers has contributed to the expansion of in-city warehouses, a trend accelerated by the closure of physical retail operations in the last year. This approach complements the increased demand for huge grade A warehouses on the fringes of major cities, which has also been a recent trend.

The Emergence Of Hyper-Rapid And Hyper-Local Delivery Methods

Recent events have not only increased the number of products and services available online but have also broadened the variety of items that consumers are comfortable purchasing from the comfort of their own homes. E-commerce platforms are rapidly being utilized to acquire everyday necessities such as food and meat, as opposed to being confined to purely discretionary items such as books and clothes. Because they are low-margin commodities, their distribution requires utmost efficiency to be sustainable. As a result, there has been an expansion in distribution networks that are specifically designed to store these things. To improve unit economics, the products supplied through these channels are procured locally and kept in places adjacent to frequently populated consuming zones. Warehouses in cities are formed.

E-Commerce Players Must Meet Shorter Delivery Deadlines.

Even for non-essential products, people increasingly prefer same-day delivery, even if it means paying a premium. With newly emerging rapid commerce providers growing to sell non-essential things such as gadgets and fashion, storage needs will rise. These companies are establishing new standards for delivery schedules. As a result, conventional e-commerce firms’ expectations are rising. The larger and more competitive ones are already expanding their distribution networks inside city premises to support the larger warehouses outside the city. Most items will eventually be delivered within hours, making in-city warehouses incredibly useful.

One may argue that getting a competitive edge in the e-commerce market is not a zero-sum game because demand for goods is a seemingly infinite flow variable. The earliest and fastest movers will have the advantage for a long time in the fight to grab more of the in-city shrinking regions. The same cannot be true for actual real estate in crucial inner-city locations, which will be depleted at some time in the future. This awareness is fueling increased demand for the development of multistory warehouses in congested metropolitan areas.

Two key trends have emerged in the global and Indian logistics industry recently. The first of them is a shift in the function of the warehouse. The warehouse has evolved from a place to keep inventory to a key facilitator of better efficiency in logistics operations and a significant contribution to corporate development and success. As a result, the second, more visible trend has emerged: an increase in demand for Grade A warehouses and warehousing space in general. This tendency has intensified in recent years due to the e-commerce boom and, more recently, the advent of q-commerce (rapid commerce/on-demand delivery). Warehouses are not only increasing in quantity to fulfill the growing demand from these areas, but they are also increasing in size.

A warehouse management system helps a firm in a variety of ways, some of which are obvious, but there are also secondary benefits that will be discussed more below. WMS automation improves inventory control by enhancing accuracy, throughput, and speed.

Exploring the advantages of a warehouse management system is crucial for expanding businesses. A warehouse management system may greatly assist in developing businesses with on-hand items (WMS). The WMS would increase operational efficiency for both labor and physical space by monitoring work processes at several levels of multi-modal existing logistics parks in India, raising productivity and improving asset utilization.