Supply Chain in India – 2025

Organisations will have to adapt to a unique set of market challenges. The supply chain will be impacted by various constantly changing factors such as the development of mega cities, the consequent growth in consumer segments, bludgeoning global trade and most importantly affordable technologies.

Increased number of Mega cities:

A growing population and urbanisation will lead to several cities becoming mega demand centres. Congestion and space restrictions will require a different supply chain model to address the needs of these mega cities.

Mega cities, create a large market that is a ready consumer of goods and services. Meticulous planning is required to avoid the logistical challenges that these cities are sure to create in terms of congestion, traffic and disruption of supply chain deliveries to the urban areas. Data generated through the phones viz. transactional, census and geo-spatial data along with driver activity will help analyse and adapt last mile supply chain in these cities. Going vertical, using common carriers for deliveries, electric vehicles, and flexible unloading are also worth considering for designing supply chains for the future.

Enhancing the Supply Chain Infrastructure

Indian supply chain infrastructure will soon need to undergo a complete overhaul to be able to cater to a rise in demand among consumers in the soon to be seen smart cities seeking better and on-time services. Some changes that will be required will be on the lines of:

  • Automation of manufacturing processes and material handling processes. Automation will increase efficiency resulting in efficient processes.
  • Verticalisation of larger inventory in lesser number of warehouses so that rental costs on depots and stores are better controlled.
  • Change in design, creating leaner design to manage the movement of large sized cargo across the supply chain.
  • For the above to happen with increase in scale and scope of work, the supply network has to be consolidated to handle higher volumes. The supply chain design will need to be modified to adopt the multi-modal network model. Manufacturing practices will have to be standardised.
  • The most important of all will be the implementation of governmental policy reforms, if effected, which will prove advantageous to Indian business houses around the world because trade volumes are sure to multiply to at least five times in the coming decade in the light of the optimistic environment of increase.

The positive trends will yield equally positive results provided the central government, business houses and supply chain entities work together efficiently in tandem because SCM is productive only if it fulfils customer demands through an optimum use of resources, distribution capacity, inventory and labour.

Source: Supply Chain 2025: Trends and Implications for India, A.T. Kearney-CSCMP study

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