National, 24th March 2021: As per Indian Brand Equity Foundation, the micro Small and Medium Enterprises (MSMEs) sector is a major contributor to the socio-economic development of the country. In India, the sector has gained significant importance due to its contribution to Gross Domestic Product (GDP) of the country and exports. The sector has also contributed immensely with respect to entrepreneurship development especially in semi-urban and rural areas of India.
It further states that India has approximately 6.3 crore MSMEs. The number of registered MSMEs grew 18.5% Y-o-Y to reach 25.13 lakh (2.5 million) units in 2020 from 21.21 lakh (2.1 million) units in 2019. The Indian MSMEs sector contributes about 29% towards the GDP through its national and international trade.
The growth of SMEs and MSMEs is core to warehousing because of the nature of business. With the focus on Make in India, the local businesses who are into manufacturing, will need storage and logistics services. For instance, the company manufacturing phones will need the nearest warehousing space to make it available to their customers in the shortest span in time. For this, the company would be willing to go with warehouse providers with Grade A facilities which would give it seamless access to the nearest selling hub and reduce the overall transportation cost.
While the demand is set to increase, it becomes crucial for the service providers to consider the following:
Technological upgradation of traditional warehouses
SME’s and MSME’s heavily rely on productivity and competitive edge within the market. For them to succeed, steady logistics and warehousing support is an important requirement. The technological upgradation will help the companies get an advantage over its competition in the market. Services like remote monitoring and real time data on inventory, improves their operations and provides a cost effective alternative for the sector driven by production of goods.
Better management of assets
The SME and MSME segment was majorly impacted amidst pandemic. At this point in time when the businesses are working towards a faster revival, what remains crucial to them is cost optimisation, value that they drive and sustainability. As the SME and MSME players are slowly moving up the value chain, they lay emphasis on planned logistic and warehousing options which will be able to help them with a holistic growth.
Safety solutions
The large inventory also implies a huge investment made by the company. In such situations, the chances of risking safety is high. Large and established players have invested heavily on designing a safe infrastructure and ensure end to end security for their customers.
The recent development which caused a stir in the market has also brought opportunities for the companies to rethink and realign their business priorities. The businesses, especially in the SME and MSME segment, have understood that investing in quality infrastructure, warehousing and logistic services will reduce overall cost and increase the overall efficiency. The rise in demand for consumer goods amidst pandemic has reaffirmed that the consumers will continue making their purchases. To cater to this inflow of demands, the companies will have to maintain adequate stock that could be delivered at the earliest. The business continuity plan will largely depend on how the companies manage their inventories and deliver to their customers, for which quality warehousing facility will continue playing a vital role.