Indian Transport & Logistics

Pandemic opportunity to improve the logistics sector in India

For the trucking industry to flourish in the new normal, three huge hurdles have to be tackled.

Pandemic opportunity to improve the logistics sector in India

The last two years' pandemic crisis has put the spotlight on the logistics operations in the country. This has led to the inevitable conclusion that digitization is going to be the best bet to optimize the Indian trucking industry. The pandemic forced Indian truck operations to be restricted within predefined zones and across states, often in a circuitous way, leading to the usage of routes that were not optimal. There was also a sharp hike in truck rental costs that varied between 56 and 74 percent. Among the visible operational changes is the approach towards FTLs, LTLs, and milk runs. For instance, milk runs have gained in popularity as they prove to be effective in the aggregation of demand across various goods and shippers. Instead of running LTL or waiting for FTL, truckers relied on the milk runs and picking cargos on the go.

Trucks are the dominant form of transportation in India. While the country is now rapidly moving toward a multi-modal transport ecosystem that remains resilient and operational in all circumstances, trucking will continue to be the key to goods access. While railways will be able to offer goods movement across various regions and states, it is trucks that will be the key to moving cargo into the interior areas. Similarly, last-mile connectivity support will continue to make air-shipping or waterways rely on trucks for successful operations.

Thus, what we are going to witness is the seamless integration of multiple modes of goods transport; essentially, rail cargo movement will be backed by trucks for local connectivity. For the trucking industry to flourish in the new normal, three huge hurdles have to be tackled.

Informal nature of the transport industry
Most of the transport sector is heavily unorganized and informal. People often have to rely on third parties and external sources to find a business for their trucks. This also inadvertently increases the

Lack of trust
Traditional transport businesses are local-network driven. Truckers and shippers both prefer to operate within their limited local circles of agents, truck drivers and shippers. There is a huge lack of trust while doing business with anyone outside their respective personal network due to the risk of crime or financial losses.

Poor infrastructure
Most highways aren't able to handle heavy or prolonged transport durations. They are also not capable of handling more vehicular movement than what they already deal with.

While the government is already taking steps towards improving infrastructure, and road construction activities are going on at an unprecedented pace in various parts of the country, it is the transport sector itself that needs to overcome the other challenges. Digital transformation of operations is the best option for transport companies. It will offer them speed, flexibility and visibility that will enhance resource optimization and cut down risks.

Using advanced technologies to enhance operational capabilities is not just an option today, but a necessity for transporters looking at long-term survival. Most large logistics companies are making the switch, but the small operators that run more than 75 percent of Indian trucks, are facing difficulty undertaking advanced digital transformation of their operations.

Modern truck aggregator platforms are rapidly emerging as the right option for this segment of the transport industry. Lakhs of truckers and shippers are now joining such platforms to offer/hire truck services with complete assurance of safety. Further, these platforms use the most advanced AI, data analytics and IoT technologies. Using such tech, even the smaller truckers can experience world-class sophistication, streamlining and optimization of their operations.

Further, such advanced technology deployment can reduce the cost of transportation by up to 25 percent, and significantly boost revenue generation through online bidding for loads. Going forward, the Indian logistics sector is set to reinvent itself in a digital avatar that will be accessible and beneficial for all stakeholders, at all times.

The pandemic has opened up an opportunity, and the trucking industry is all set to grab it!

The views and opinions expressed in this article are those of the author and do not necessarily reflect the views of Indian Transport & Logistics News

Karan Shaha

Karan Shaha

He is the chief executive officer and co-founder of the online transport market platform Vahak.

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