Frag­mented dis­tri­bu­tion Chan­nel

Cargo Talk - - Guest Column -

There is a dearth of third-party lo­gis­tics ser­vice providers and in some states, in­te­grated sup­ply net­work and 3PL ser­vices are en­tirely miss­ing. The dis­tri­bu­tion chain is frag­mented and is marked by the pres­ence of a large num­ber of in­ter­me­di­aries. The lo­gis­tics cost in In­dia is high – a Plan­ning Com­mis­sion study es­ti­mated that ap­prox­i­mately 14 per cent of a prod­uct’s cost rep­re­sents lo­gis­tics-re­lated costs. This makes it dif­fi­cult and costly to have an ef­fi­cient sup­ply chain which is the key to suc­cess of or­gan­ised re­tail. re­tail is reg­u­lated by mul­ti­ple agen­cies and a typ­i­cal food and gro­cery re­tailer has to ob­tain 40-50 li­censes to set up op­er­a­tions for each store. A num­ber of cor­po­rates are fac­ing short­ages of tal­ents and they have to set up in-house train­ing fa­cil­i­ties to de­velop skills.

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