India’s Warehousing Sector to Expand Significantly by 2027
The Indian warehousing sector is on the brink of a major expansion, with demand expected to reach 1.2 billion square feet by 2027. This growth, highlighted in the report “Future of Logistics: Warehousing Market – India” by JLL India and Miebach Consulting, will include Grade A, B, and C warehouses across all Indian cities, reflecting changing supply chain needs.
Growth in High-Quality Warehouses
High-quality Grade A warehouses are projected to grow from 290 million square feet in 2023 to 400 million square feet by 2027. This trend is driven by e-commerce, Third-Party Logistics (3PL), and omni-channel retail, which require superior infrastructure.
Geographic and Technological Shifts
The warehousing landscape is expanding beyond Tier I cities, with a 41% increase in warehouse space absorption in Tier II and III cities between 2022 and 2023. Sanjay Bajaj, Senior Managing Director of Logistics & Industrial, India, JLL, noted the industry’s shift towards Environmental, Social, and Governance (ESG) compliance and the National Logistics Policy’s goal to reduce logistics costs to 10% of GDP.
Urban Fulfillment and Automation
Urban fulfillment needs are rising, with an estimated 35 million square feet required by 2027 for last-mile delivery solutions. Shubhendu Kumar, Director, Miebach Consulting, India, emphasized the increasing need for superior infrastructure and larger spaces, marking a new era in warehousing. Automation is crucial in this transformation, with India expected to become a top user of warehouse automation systems globally by 2026, reaching a market value of USD 2 billion annually.
Doubts Revealed
Warehousing Sector -: The warehousing sector involves large buildings where goods are stored before they are sold or distributed. It’s like a big storage room for companies to keep their products safe and organized.
JLL India -: JLL India is a company that provides real estate services. They help people and businesses buy, sell, and manage properties like buildings and land.
Miebach Consulting -: Miebach Consulting is a company that gives advice to businesses on how to improve their supply chain and logistics. They help companies make their processes more efficient.
Grade A warehouses -: Grade A warehouses are high-quality storage buildings. They are built with the best materials and have modern facilities to keep goods safe and easy to access.
E-commerce -: E-commerce is buying and selling goods or services over the internet. It’s like shopping online from websites like Amazon or Flipkart.
Logistics -: Logistics is the process of planning and managing how goods are moved from one place to another. It involves transportation, storage, and delivery of products.
Tier I, II, III cities -: In India, cities are often categorized into tiers based on their size and development. Tier I cities are the largest and most developed, like Mumbai and Delhi. Tier II and III cities are smaller and less developed but are growing quickly.
Automation -: Automation means using machines and technology to do tasks without human help. In warehouses, automation can involve robots and software that help move and manage goods more efficiently.