Excellerate Scheme for Emerging Leaders

Name: Mr. Sandip S. Kadam

SWU: Operations Consulting
Key Area of Expertise Warehouse Solution Designing, Process Improvements, Lean
Techniques etc.

Initiative: Consulting for Warehousing Services

Opportunity:
The size of the Indian warehousing industry (across commodities and modes) is pegged at about INR
50,000 crores for organized sector by 2025. Indian Warehousing Industry is expected to grow at 10-15%
in coming years. The Market share within Warehousing industry is as given below:
Industrial/Retail warehousing: accounts for ~55% of the total market
CFS/ICD: ~14% share
Agri warehousing: 15% share
Cold stores: ~16% share

Warehousing Sector in India

16.00%

Warehousing
15.00%
CFS/ICD
Agri Warehousing
55.00% Cold Storage

14.00%
Organized Vs. Un- Organized Players in Warehousing Services:

Unorganized companies still dominate the industry, accounting for ~74% percent of the total
warehousing market in India. The key reason for lower penetration of organized companies is a
commodity mindset which has led to a lack of differentiation and is driving fragmentation.
However, the participation of organized players is increasing significantly over the years. In the long run,
warehousing will evolve into an organized segment in the same league as its global counterparts.
By 2025, organized warehousing market is estimated to be at INR 27,600 crores.
Investments in Warehousing Industry:

Some of the major Private Equity investments Logistics Industry in recent times are as below,

Amid this changing scenario, we have also observed the foray of many international businesses and
emergence of e-commerce players who prefer to establish their warehousing footprint only through
legally compliant warehouses.
Close to INR 45,000 Crores to Be Invested In Storage and Warehouses by 2020: JLL Report

 Over 200,000 new jobs expected to get created through storage and warehousing development
 Warehousing supply to almost double to 247 million square feet in next three years

Considering above points, consulting in warehousing services will be great opportunity for RSM, waiting
to be unlocked.

Project Plan:
1] Consulting Services Offerings:
Consulting clients to solve their Warehousing related problems. Key Services can be offered as below:

i] Third Party Warehouse Review: Cost Review, KPIs & SOP audit, Safety Audit etc.

ii] 3PL Contract Award Process and Vendor Evaluation: handling bidding process for selecting 3PL
service partners on behalf of client and evaluating bids received

iii] Inventory Analysis & Optimization: Analysis of Inventory data and suggest improvement areas

iv] Warehouse Operations Efficiency Improvement: Operations study and productivity improvement
through Layout changes, MHE selection, Automation, Warehouse Slotting etc.

v] Warehouse Infrastructure Design & Equipment selection: Layout Design, infrastructure selection like
Heavy duty racking, ASRS, Vertical Lift Modules etc.

vi] Design of Value Add Services like Kitting /Bundling etc.: Study and improve Value Add Services in
Warehouses like Kitting/ Bundling through Layout changes, Time Study Techniques etc.

2] Enablers:
Following enablers will help us to develop solution for potential customers and deliver effectively:

I] Models: Cost models to arrive correct Warehouse pricing

ii] Templates: Template to gather relevant information while visiting warehouse of industry vertical

iii] Bench marks: Cost Benchmarks for Capex & Opex expenditure items related to warehouses

iv] Checklists: Points to cover during independent warehouse audit etc.

v] Database: Database of 3 PL Players, Vendors providing services to warehousing, Region wise
warehouse rentals etc.

3] Potential Clients
I] Existing Internal Audit Clients:

Sr. No. Client Name

1 Castrol
2 Birla Copper
3 Raychem PPG
4 Total Oil
5 Aditya Birla Retail
6 H&R Johnson
7 HMS Host

II] Possible Customer segmentation for new clients:

Sr. No. Segmentation Samples

1 Companies managing their own warehouses & e.g. E-Com Players
looking to bring down the warehouse expenses
2 Companies managing their warehouses through e.g. Consumer
3PL & looking to change 3PL service partner or Goods , Sanitary
reduce monthly 3PL fees through negotiation ware, Industrial
goods sector
3 New Entrants in India & looking to outsource their e.g. MNCs entering
warehousing operations into India or trying
to sell in India
through E-com
players
Market Intelligence report of many of such clients is attached in annexure-2

4] Business Plan:
i] Go to Market Document: Create Go To Market document with detailed offerings,
segmentation, case studies & people credentials

ii] Diagnostic Studies: To Start with, we can do diagnostic studies for client’s Warehouse audit or
Warehouse Cost Review Assignment.
iii] Develop People & Capabilities: Training team on warehousing cost models, storage solutions,
resource modeling, warehouse Productivity, SOPs & KPIs, world class logistics practices etc.

RSM will need helping hand in following areas:

Sr. No. Area of Association Partner Name

1 Warehouse Property Identification & Rate CBRE/ JLL
Confirmation
2 Warehouse Layout/ Design Miebach Consulting
3 Network Optimization/ Warehouse Simulation Llamasoft /CLASS/Flexsim /
Miebach
4 3PL RFP Process Management Major 3PL Companies

Iv] Success Stories: Generate success stories, receive references and expand clientele.

References:`
1] https://www.alvarezandmarsal.com/sites/default/files/45551-603_logisticsbrochure_03.pdf

2] https://economictimes.indiatimes.com/news/economy/policy/gst-infrastructure-status-drive-pe-
investments-in-warehousing/articleshow/64535162.cms
Annexure:
1] Major 3PL Companies operating in India

Sr. 3PL Company List

No.
1 DHL
2 DB Schenker
3 Stellar Value Chain Solutions
4 Yusen Logistics India Pvt. Ltd.
5 Hellmann Worldwide Logistics India Pvt. Ltd.
6 Agility Logistics
7 Hitachi / Flyjac Logistics
8 TVS Logistics
9 Rivigo Logistics
10 Mahindra Logistics Ltd.
11 All Cargo Logistics Ltd.
12 Gati KWE
13 Kuhne Nagel
14 UPS
15 Tiger Logistics

2] Market Intelligence List for New Clients

India_Market
Intelligence Database_CL_29-01-2018.xlsx