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A logistics company is a key player in orchestrating the movement and storage of goods, and services across the supply chain, bridging the gap between production and consumption sites. They manage the whole planning, implementing, and controlling these critical operations, tailored to meet clients' diverse logistical needs.
In today's globalized landscape, logistics encompasses the efficient flow and storage of commodities from origin to consumption, with supply chain management serving as a vital component. This dynamic industry is pivotal in ensuring seamless transportation and resource management on a global scale.
Logistics plays a significant role in India's GDP, contributing around 14.4% and showing rapid expansion. The Indian logistics market is projected to grow at a Compound Annual Growth Rate (CAGR) of 15.5% by 2024, with over 22 lakh people employed in the sector.
The warehousing and storage segment is experiencing even faster growth, with an anticipated CAGR of 15.64% and a market size expected to reach 34 billion dollars by 2027. This growth is driven by increasing demand, particularly from significant e-commerce players, and the rising importance of tier II and III cities.
Know about the types of logistics businesses and its ongoing and upcoming technological advancements:
Last-mile logistics is pivotal, impacting customer satisfaction and brand loyalty. Despite challenges, innovative solutions like route optimization and eco-friendly deliveries are reshaping last-mile services. With advancing technology and sustainable practices, this segment is transforming into an opportunity to enhance customer experiences. Recently, it has gained attention due to its crucial role in satisfying customers' need for faster deliveries, making it a costly yet significant aspect of logistics.
Last-mile logistics typically represents a substantial portion of total logistics expenditures due to factors like fuel expenses, labor costs, and technological requirements. To mitigate these financial challenges, businesses are adopting cost-effective strategies such as crowd shipping, shared urban distribution centers, and autonomous delivery vehicles. These approaches aim to streamline costs while preserving the effectiveness of last-mile operations.
Air freight services are crucial in India’s dynamic global economy, enabling fast and efficient cross-border movement of goods. As we look ahead to 2024 and beyond, factors like technological advancements, changing trade patterns, and evolving consumer demands will shape the trajectory of air freight services with the below enhancements:
1) Blockchain technology - enhances transparency, traceability, and security throughout the shipment journey. Every recorded transaction and document maintenance minimizes fraud risks, and streamlines custom services.
2) Predictive analysis -With Machine Learning and big data leveraging demands are forecasted, route optimisation, enhanced efficiency, etc.
3) Drone delivery- Drones are disrupting the logistics industry, especially in air freight services, by revolutionizing last-mile delivery, especially in remote areas. Their agility in navigating tough terrains and swift package delivery presents a cost-effective and efficient alternative to traditional methods.
Warehouses store inventory for manufacturers and distributors and provide storage space, staffing, equipment maintenance, order fulfilment, packaging, shipping, receiving, and tracking shipments.In coming years, the warehouse business witnesses both innovations and challenges with high technology advancements as :
1) Automation and Robotics: These have transformed warehouse operations, boosting efficiency and streamlining processes. Automated guided vehicles (AGVs) operate autonomously within warehouses, moving goods between storage spots and loading docks. They're equipped with sensors and navigation systems to navigate obstacles and optimize routes, minimizing manual labor in material handling.
2) Internet of Things: IoT enables warehouses to collect real-time data on inventory levels, equipment status, and environmental conditions. IoT sensors in warehouses track variables like temperature, humidity, and vibration, ensuring optimal conditions for sensitive items. Data is sent to cloud platforms for analysis with advanced algorithms. Managers remotely access insights for proactive decisions and operational optimization. Alerts are triggered if conditions jeopardize products, allowing swift corrective actions to prevent losses.
In order to start a logistic franchise business, you can get a brief glimpse of the roadmap in the below points:
Select a franchisor: Conduct comprehensive online research on logistics companies interested in franchise expansion. Familiarize yourself with their terms, conditions, and prerequisites for launching a logistics business under their brand.
(You can check our website for some of the logistic brands that are expanding through franchises)
Apply for the franchise: Once you are sure about the franchisor where you will invest as a franchisee, you need to connect with the franchisor and discuss if their business process aligns with your requirements. If all goes well, you will have to decide on hiring the manpower, capital investments, sufficient fund until you reach the break-even point.
Legal help: It is always recommended to take legal assistance in understanding the terms and conditions, tax details, if any agreement point that needs to be initiated from your end.
Urban congestion: Urban congestion causes delays, higher fuel usage, and increased emissions. To tackle this issue, logistics firms are employing cutting-edge route optimization algorithms, real-time traffic data. Through optimized routes and alternative transportation, companies can effectively manage the challenges of urban congestion, ensuring timely and efficient last-mile deliveries while minimizing environmental impact.
Customer expectations: E-commerce's rapid growth has raised customer expectations for fast, flexible deliveries like same-day or next-day options and specific time slots. Meeting these demands means investing in tracking systems, and flexible delivery models.
Parcel theft and security: With the rise in online shopping, the risk of parcel theft has also grown. Unattended packages are easy targets, causing customer dissatisfaction and replacement costs. To boost security, logistics companies are looking into solutions like parcel tracking tech. These measures not only curb theft but also give customers live updates on their deliveries, ensuring peace of mind and a better experience overall.
Technology integration: The successful execution of logistics relies heavily on the integration of advanced technologies like route optimization software, real-time tracking systems, artificial intelligence and automation in sorting which incurs more costing.
1) Capital investment: Any logistics franchise you sign up to join will require investing a sum of money that is mentioned by the franchisor in the contract. For setting up franchises in India this money can range from ?1,00,000 and ?3,00,000.
2) Space: Franchise in logistics would require a significant amount of space to stock shipments before they are delivered. Most logistics franchisors demand for a space between 400-600 sq.ft.
3) Equipment: Setting up a logistics franchise requires essential equipment such as computers, reliable internet connectivity, a backup generator for uninterrupted power, transportation vehicles, barcode scanners, printers, and more. However, these are fundamental for starting and operating a logistics franchise successfully.
4) Manpower: Typically, Indian logistics franchisors require a minimum staffing level for delivery executives and personnel handling delivery requests on computers. This usually involves hiring 10 or more employees as per their guidelines.
5) Develop a Marketing Strategy: To promote your logistics business, you need to develop a marketing strategy that includes both traditional and digital marketing methods.
Proof of identity (PAN/Aadhaar Card)
Business registration (Sole proprietorship/LLP/Pvt ltd)
GST Registration
Property address proof (electricity bill/ration card)
Shop and property documents like rental agreements, etc.
1) Established Brand Value: Franchising with a reputable logistics brand offers instant recognition and trust among clients, aiding in customer acquisition and retention.
2) Operational Support: Franchisors often provide extensive operational support, including training, technology integration, and marketing assistance, reducing the learning curve for franchisees.
3) Low Entry Barrier: Compared to starting a logistics company from scratch, franchising requires a lower initial investment and offers a ready-made business model with proven success.
4) Scalability: Logistic franchise businesses can scale rapidly by leveraging the franchisor's brand reputation, support systems, and established clientele.
1) Franchise Fees and Royalties: Franchisees typically incur initial franchise fees and ongoing royalties, which can impact profitability, especially in the initial phases.
2) Operational Constraints: Franchise agreements may impose operational guidelines and restrictions, limiting flexibility in decision-making and business strategies.
3) Dependency on Franchisor: Franchisees rely heavily on the franchisor for branding, technology, and operational support, which can pose challenges if the franchisor's standards or support levels decline.
4) Market Competition: The logistics sector is highly competitive, with both franchise and non-franchise players vying for market share, necessitating continuous innovation and service differentiation.
Is the logistic franchise business fully automated?
The logistic franchise business is semi-automated. It is a challenging business and requires human assistance in resolving and smoothing the business process.
Here are a few of the best logistic franchise brands in India: (It is recommended to conduct research before selecting the right franchise brand)
Investing in a logistic franchise is a smart move, offering high end demand, scalable operations, and good support.With continuous growth of e-commerce, reliable logistics services are essential.Franchiseee benefit from established brand recognition and proven business models, ensuring steady returns and lower risks.
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