Indian Logistics spends 13% in GDP (versus 7-8% in developed countries), implying overall size of US$ 180-220 bn. Transportation cost of GDP is 8%. Current transport industry is completely unorganised so there is no fixed rate causing transporters to suffer due to its high operating cost.
The reasons this sector in India is still unorganised in our country are:
- Presence of Large number of Small Truck Owners with Less than 5 trucks.
- Presence of Transport Agents / Brokers which results in automatic Price escalation.
- Absence of uniform pricing. Pricing is regulated on the basis of Truck availability, Demand & supply in the market.
- Absence of proper monitoring of Trucks and Route optimization.
- Lack of training to drivers and other related parties leads to improper management
When it comes to Logistics, logistics executives must make further decisions beyond the mode of transportation to include:
- Importing and Exporting Regulations
- Freight Damage Claims
- Working & collaborating with other executives within the supply chain
- Managing vendors and partners
- Responsible for mitigating risk and mitigating expenditures