Indian Transport & Logistics

Why outsourcing warehouse ops to right 3PL partner key differentiator

Read 4 benefits of outsourcing warehouse ops that can help businesses adopt leaner and more effective business models.

Why outsourcing warehouse ops to right 3PL partner key differentiator
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One of the most significant factors of modern supply is the warehousing facility. The Indian warehousing sector has today evolved to become state of art storage facilities that have advanced tech solutions and leverage innovations in AI, ML, and IoT to optimise operations, streamline the movement of goods and track inventory. Apart from being a storage facility, modern warehouses are also playing a crucial role as growth partners for manufacturing and export-import sectors, becoming well-aligned to the changing needs of businesses, across the globe.

It is not a surprise then that the sector, which was valued at ₹1,206.03 billion in 2021, is expected to grow to ₹2,872.10 billion by 2027, expanding at a CAGR of 15 percent during the 2022-2027 period.

Despite the advancement in the warehousing sector, it is still often considered a rather high investment. India’s new logistics policy has laid significant groundwork for crafting a growth path and transforming it into a collaborative and well-organized sector. Even as India leaps forward to becoming a global manufacturing hub, it is imperative that industries and businesses understand the use and importance of 3PL service providers and contract logistic partners who offer structured and tech-driven warehousing facilities.

Here are the 4 benefits of outsourcing warehouse operations that can help businesses adopt leaner and more effective business models.

1. Effective use of resources
This is one of the main advantages of outsourcing in general and specifically in warehousing. Self-managed warehouse operation needs resources that are focused on servicing it exclusively in terms of time, money, personnel, and other extra costs. Outsourcing operations support allows business owners and internal departments to be focused on the company’s core offering. Companies can channel their resources for innovation, R&D, and new business development while reaping the advantages of smart warehouse management at a cost advantage and low time investment.

2. Smooth operations
Another important aspect of partnering with an expert is gaining access to a smart, tech-enabled and efficiently managed warehouse, customised to the need of your product. Be it food and pharmaceuticals that require controlled temperatures or dyes and speciality chemicals which require enhanced safety standards and fragile handling, an expert warehousing partner will be able to offer effective and efficient storage solutions. Additionally, cross-training and implementation of best practices are some of the top benefits derived from the outsourced partner across various product categories. This ensures professional management of storage, retrieval, inventory management, put-away, packaging and other value-added services

3. Better market reach
While an in-house or company-owned warehouse requires CAPEX investments and resources for swift functioning and management, it also is generally located closer to the manufacturing facility and along a limited set of geographies, which can also be expensive. This can be a hindrance for the business as it limits access to the market, resulting in delayed supply or a lack of opportunities to reach new markets. Strategically situated warehouses that are closer to target markets, and are professionally managed by 3PL service providers, offer not only easier and faster access to the market at a lesser cost but also the flexibility to reduce or increase consumption of storage space, based on demand. Additionally, businesses can scale up or cut down their storage and distribution operations as per specific market requirements, and become accessible to long-term or project-based strategic warehouse locations, while meeting the requirement of enhanced market reach and customized consumer demands at a relatively shorter turnaround time.

4. Access to the latest tech-enabled services
In a digital-first world, tech adoption can be a game changer. With newer innovations in automation, AI and ML-driven solutions crafted specifically for smart warehousing, access to tech-first storage facilities has become vital for effective market reach and efficient operations. And a warehousing expert partner can provide just that! Outsourcing warehousing operations and management helps businesses to leverage the best of tech innovations that help in fast-paced growth across locations, at a comparatively cost-effective rate. In addition to this, outsourcing with a warehousing expert also allows access to value-added services while enjoying an agile and callable storage network that offers tech-first advantages like real-time inventory updates, a dashboard for live information, expert handling and transportation of goods, and round the clock monitoring, among other advantages.

A robust and cost-efficient logistics and warehousing is a must in today’s international economic and business environment. This being one of the important factors of the government’s NPL is a sign that it is needed for businesses to have updated and swift functioning warehousing facilities. And while it does come across as a sizeable investment in the beginning, the ROI is much bigger and with the right warehousing partner, it can also mean accelerated growth and ease of reaching out to new markets. In today's economy, it is only vital to have a warehousing partner in place if one is looking towards building a stronger business foundation and has a vision for fast-paced growth.

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.

Varun Gada

Varun Gada

He is the director of LP Logiscience – A Liladhar Pasoo company.

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