Logistics crucial to ‘Make in India’ initiative

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Logistics crucial to ‘Make in India’ initiative

Every business establishment isaimed at providing quality, timely

and effective products or services totheir customers as a means of retain-ing them and opening more cus-tomer doors. Business logistics isvery important in business for itactually leads to the ultimateconsummation of the salescontract. Logistical supportenables the actual movement,delivery and transportation of goods or services from a seller to a buyer.

By initiating ‘Make in India’ cam-paign, we are basically inviting foreignmanufacturers to produce in India.However, it can only succeed if effi-cient logistics is made affordable. If

we want to produce for the market,there needs to be a way to distributeit in an affordable manner, which canbe managed by producer. To export,there should be adequate capacityand deep draughts at ports to ensurefaster turnaround of vessels. Vesselturnaround time at ports should be inline with the global practice; insteadof four days, it should take a maxi-mum time of day-and-a-half.

Today the increased depend-ence on road logistics is increasingthe burden on local manufacturer.Besides, the high cost of road logis-tics highly demoralises the localmanufacturer doing business. Theonly way to solve the situation is bydeveloping other means of transportlike seaways and railways, whichshall reduce the dependency on theroad transport avoiding the highercost involved in it.

The logistics department is oneof major departments in multinational

firms. Logistics at a global stage isvery crucial in globalisation. Verymany businesses are involved inmultinational trade, hence the neces-sity of well laid out coordination of the

shipment of goods has increased.Efficient logistic systems throughoutthe world economies are the basisfor trade.

Logistic support has gainedimportance in international market-ing as a result of technologicaladvancements in information andcommunication technology. Theinternet has allowed for the ease ofshipping handling and most compa-nies are restructuring their opera-tions globally. Advancements incommunication and informationindustry enable logistic managers toupdate sales and plan inventoryfaster and more frequently.

Establishing a logistics plan isessential. Pointing out the stepsrequired and the personnel who willbe assigning responsibilities to those,who will be performing the specifictasks is also essential. An efficientplan is necessary for the planning orcontrolling of activities of an organi-sation. It has to be clearly defined in order to avoid vagueness or confusion that could interfere with the accomplishment of the desired goals.

While drafting such a plan, it isimportant to keep in mind all the pos-sible present and the future scenar-ios. A logistic manager needs to have

the capability to carefully plan,analyse and implement forecasts toa considerate extent on behalf of afirm. The plan he or she drafts shouldbe organised such that everyemployee knows their duties, respon-sibilities and roles. Coordination andunderstanding between all thedepartments will enable the realisa-tion of the goals of such a plan.

Logistics planning too is animportant part of business nowa-days. How quickly and reliably goodsare delivered to customers can meanthe difference between retaining yourcustomers and losing them. A greatdeal of business logistics comesunder the heading of marketing andspecifically, distribution. The planningphase is the most important followedby good implementation of a logisticsplan. It is not only the speed of deliv-ery that matters, but also the productquality and customer service.

A buyer is always concernedwith the actual delivery of goods orservices as per the agreed sales con-tract. He or she is not interested withthe promises of a seller about theircapability to supply the same; it isassumed. Delivery of goods or serv-ices to a buyer according to the salesagreement is important so as to avoidlegal tussles that may arise as aresult of delays or failed contracts.Timely deliveries and honouring con-tracts is essential in maintaining yourclients and obtaining repeated orders.

Effective logistical systems con-tribute heavily to the achievementsof the firm and its marketing objec-tives. It is very essential in creatingplace and time utilities in the productsin order to maximise customer satis-faction. A quick and timely delivery inminimum time and cost relieves thecustomer of excess inventories andsubsequently brings down the costof carrying inventory, transportationand material handling. This improvescustomer service and reduces costs.

In a nutshell, ‘Make in India’campaign is not a far dream if thesolution to the obstacles areanswered or combatted judiciouslyby efficiently developing other meansof transport. Introducing policies per-taining to the reduction of the cost oflogistics and by introducing Goodsand Service Tax (GST), which willreduce the other taxes will alsoreduce the logistic costs involved.

The ‘Make in India’ strategy planned by the government aims to transform the countryinto a major manufacturing hub and encourages foreign companies to come andmanufacture in India. As the initiative plans to garner huge investment, bringing lots ofcapital into India it cannot be denied that the need for efficient logistics would also be feltto cater to the same.

Deepak Baid Director Siddhi Vinayak Logistic

A second weekly freighterflight was initiated to Chennai byCargolux in partnership withOman Air from August 11, 2015.The partnership inked in April2015 between Oman Air andCargolux enables both to jointlyaccess new freighter destinationsand contribute to the logistics facil-ities of Oman. Two full freighterflights from Chennai to Muscatwould be operated by both OmanAir and Cargolux. This enables theformer to strengthen its presencein the Indian market by accessingthe industrial belts of South Indiaand the latter to use Oman Air’s experience of flying to arange of global destinations,including 11 in India.

Cargolux – OmanAir: 2nd freighterflight to Chennai

The Government expects tofinalise the revised draft civil avia-tion policy by the first week ofSeptember. The new policy whichhas been under work from quitesome time is anticipated to focuson improving air connectivity apartfrom possible changes in overseasflying norms for local carriers.

RN Choubey, Secretary,Ministry of Civil Aviation says, “Thedraft policy is expected to be put upfor public comments by the firstweek of September. The inter-min-isterial consultations are taking timeand there is nothing problematic.”

Among others, the draft policy proposes to enhance regional air connectivity, rationalisejet fuel costs, promote air cargo, maintenance, repair and operations (MRO) and helicopter operations and improvepassenger facilitation.

The draft policy was initiallyunveiled in November 2014 andafter taking into consideration thecomments and suggestionsreceived, the Ministry is looking atcertain modifications to it.

Draft civil aviation policy by September

Railways: two DFC projects sanctionedIn an information shared by

Manoj Sinha, Minister of State forRailways in a Lok Sabha session, twoDedicated Freight Corridors (DFC)

projects on the Western and Easternroutes have been sanctioned and areunder implementation at a cost of`81,459 crore (excluding cost of

Sonnagar-Dankuni Section of EasternDFC). Compensation Award of 85 percent of land has been completed, while65 per cent of civil contract and 48 per

cent of system contract have beenawarded. The physical progress of civilwork is 20 per cent. The freight carry-ing capacity of the two corridors would

be over 500 billion NTKM per year. The unit cost of freight transport on the two corridors will be lesser thanthat of Indian Railways.

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