Logistics - Services Marketing

Mangesh Sarfare
Joseph Selvaraj
Sikandar Pote
Shakti S Rathore
Sujal Shah
Suryaprakash Sharma Prof Gautam Agarwal
Jaspreet S Nagi
 Supply Chain Management

 “Supply Chain Management deals with the

management of materials, information, and
financial flows in a network consisting of
suppliers, manufacturers, distributors, and
customers.” (Stanford Supply Chain Forum)
 Supply Chain Management spans all movement
and storage of raw materials, work-in-process
inventory, and finished goods from point of origin
to point of consumption
 Logistics Management

 Logistics is the “process of planning,

implementing, and controlling the efficient,
effective flow and storage of goods, services, and
related information from point of origin to point
of consumption for the purpose of conforming to
customer requirements”*
 Logistics involves the integration of information,
transportation, inventory, warehousing, material
handling, and packaging, and security.

* Council of Logistics Management - UK

 Elements of Logistics Management

 Transportation (Air, Land, water)

 Order Processing
 Warehousing
 Inventory Management
 Packing
 Material Handling
 Information Flow
 Customer Service
Importance of Logistics Management

Effective logistics management leads to:

 Reduced Operational Costs

 Improved Delivery Performance

 Increased Customer Satisfaction

 Organizations become more competitive in terms

of cost, quality, delivery & flexibility.

Importance of Logistics Management
– Today’s Scenario
 Globalization – sourcing, manufacturing &
distribution on a large scale.
 Focus on core competencies.
 Third – Party Logistics gaining importance.
Evolution of Logistics in India
 Logistics in India
 The Indian logistics sector, as elsewhere, comprises
the entire inbound and outbound segments of the
manufacturing and service supply chains.
 The Indian Logistics Industry is valued at approx
US$ 140 billion and is expected to grow @ 20% yoy
 However majority of the industry is unorganized and
fragmented.
 This fragmented segment comprises owners and
employees with inadequate skills, perspectives or
abilities to organize or manage their operations
effectively.
 Logistics in India
 Goods are transported predominantly by Road and
Rail.
 Road transport contributes to approx 60% of the
freight transport.
 It is preferred due to its cost effectiveness and
flexibility
 Rail, on the other hand, is preferred because of
containerization facility and ease in transporting
ship-containers and wooden crates.
 Sea is another complementary mode of transport.
Ninety five per cent of India’s foreign trade happens
through sea.
 Logistics in India

 Rail transport comes under the purview of the

govt, however, the road transport in controlled by
private players.
 Low cost has been traditionally achieved by
employing low level of technology, low wages,
poor maintenance of equipment, overloading of
the truck beyond capacity, and price competition.
 Steel, pharmaceuticals, food & agro-business, and auto
are growing most rapidly in the national economy – it
is no surprise that their logistics costs have been
increasing at a faster rate.
 The distribution practice of pushing goods down the
channel might be responsible for high increase in the
inventory and warehousing costs in the pharmaceutical
industry.
Example
 Logistics in India - Issues

 High Cost – Low Margin business.

 Absence of economies of Scale.
 Non-uniform tax structure across states.
 Multiple check-posts & bureaucratic harassment.
 Poor infrastructure.
 Low penetration of IT & lack of proper
communication.
 Lack of skilled and knowledgeable manpower.
 Logistics in India - Issues
 It is estimated that while outsourced Logistics accounts for 54%
of the total logistic spending in India, Organized player have
only 10% of the pie.
 In road transportation, which accounts for biggest portion of
logistics spending, 74% of the operator are small time players
owning a single vehicle.
 In outsourced warehousing 92% of players are from
unorganized sector.
 Even in Organized logistics, only a few have offering among
multiple modes and services (Transportation, warehousing and
value added services such as packaging, cold chain and custom
clearance)
 On avg a commercial vehicle is runs at a speed of 20 miles per
hour in India as compared to avg speed of 60 miles per hour in
western europe and USA.
Logistics in India – Future Prospects

 Increased spending on infrastructure by the

government. Eg Golden Quadrilateral, Free Trade
and Warehousing Zones, SEZs, etc
 100% FDI is allowed in this sector.
 Third Party Logistics business is growing at 30%
 Indian Economy growing at approx 8%
 Standard of Living growing at a face pace resulting
in an increase in spending on goods and services.
Logistics in India – Future Prospects
 NHAI is investing about $650mn towards the
development of an Intelligent Transportation System
(ITS) which will make transport services on the highways
(like reducing congestion, advance signaling, medical
assistance, accident management, etc.) efficient and
automating many processes like toll collection etc.
 Increased spending by Service Providers on IT and
infrastructure.
 Leading Players in India
 DHL

 TNT

 AFL

 GATI

 BLUE DART

 DTDC

 ASHOK LEYLAND

 FIRST FLIGHT

 AGARWAL PACKERS AND MOVERS

 Cold Chain Logistics

 Cold chain is a logistic system that provides a series

of facilities for maintaining ideal storage conditions
for perishables from the point of origin to the point
of consumption in the food supply chain.

 A well organized cold chain reduces spoilage,

retains the quality of the harvested products and
guarantees a cost efficient delivery to the consumer
given adequate attention for customer service.
 Cold Chain Logistics

The Cold chain logistics infrastructure

generally consists of:
 Pre-cooling facilities
 Cold Storages
 Refrigerated Carriers
 Packaging
 Warehousing
 Information Management systems (Traceability
and Tracking etc.)
 Objectives of Cold Chain Solutions
 Cold chains are a significant proportion of the retail food
market.
 The success of implementing cold chain management
involves continual monitoring of product temperature
throughout distribution and having appropriate corrective
action plans in place.
A streamlined, well maintained cold chain helps to:
 Reduce costs
 Improve product integrity
 Increase customer satisfaction
 Reduce wastage and returns of expired stock
 Industries requiring Cold Chain Solutions

 Imported Fresh Fruits and Vegetables.

 Exports by sea (Seafood, Meat, Poultry, Fruits and Vegetables)

 Chocolate Industry

 Dairy Industry

 Meat & Poultry (Domestic)

 Ice Cream Industry

 Processed Foods

 Frozen foods
 Customer Relationship Management
(CRM)
 Customer relationship management (CRM) is a
broadly recognized, widely-implemented strategy
for managing and nurturing a company’s
interactions with customers, clients and sales
prospects.
 It involves using technology to organize, automate,
and synchronize business processes.
 When an implementation is effective, people,
processes, and technology work in synergy to
increase profitability, and reduce operational costs.
 Benefits of using CRM

 Understand the customer better.

 It increases Efficiency.
 Gives a Competitive Advantage.
 Boosts All Round Development as a single
application can help different departments.
 Provides up-to-date information.
 Helps serve the customers better.
 Customer Relationship
Management is a prerequisite for
today's business and
organizations simply cannot
afford to bypass this customer
strategy.
 Company Profile - GATI

 One of the pioneers and leaders in Express

Distribution & Supply Chain Solutions in India.
 Provides total end to end logistics solutions for
businesses across varied verticals
 It covers 98.69% of India.
 Provides multi-modal network services (air, road,
Ocean & Rail).
 Has a strong presence in Asia Pacific Region and
SAARC Countries.
 Company Profile - GATI

 Strong IT backbone – Oracle CRM, GATI

Enterprise Mgmt System (GEMS), Warehouse
Mgmt System (WMS)
 Supply Chain Management @
GATI
 Gati provides customized solutions by integrating all the
four stages of business — procurement, production,
distribution, after sales service and reverse logistics.
 It provides a ‘Made Ready’ distribution channel with
standardization at all locations.
 Helps enter new markets without a large capital
investment
 Provides companies with shelf space in over 200
locations.
Supply Chain Management @
GATI
CRM @ GATI

5 ways to track shipment:

 Online tracking @

www.gati.com
 Mobile Updates

 Automatic Email Updates

 Registered customers can get

Email Updates on 3 email

IDs.
 Through Customer Care
 CRM @ GATI
 GATI provides options for logging complaints
through their website as well as through the
customer care numbers.
 Tracking of complaint status can be done online.
 Customers can chat online with GATI Customer
Care officers in case of any query.
 Online Requests can be given for Parcel Pick-up.
 Customers can find the Rates and Transit Time
online itself prior to booking.
 Comparisons can be done online between their
various services.
Innovations in the Logistics Sector
RFID – Radio Frequency Identification.
 Used to track-and-trace merchandise/assets
throughout the supply chain.
TELEMATICS
 Used to monitor and control remote devices (e.g
Shipment Tracking, Vehicle Diagnosis)
 Satellite tracking systems can enable operators to
position and track vehicles to assist real-time
planning.
Innovations in the Logistics Sector
DIGITAL ADMINISTRATION
 Digital Signatures are now taken as proof of
delivery.
 Eurotunnel introduced an automatic check-in
system for its vehicles.
 The equipment is made up of touch screens which
offer information for drivers at check-in in nine
European languages, automatic number plate
readers and sensors which measure vehicle size.
 It has reduced the transaction time to just 45 secs.
Innovations in the Logistics Sector

 Value added services such as warehousing, co-

packing, co-manufacturing, labeling,
postponement and mass-customization are
expanding the role and importance of logistics
providers in the supply chain.
 Concept of 4th Party Logistics is gaining ground.
These companies own the computer systems and
intellectual capital and tend to offer end-to-end
logistics services on a global scale.
Innovations in the Logistics Sector

 Green Logistics is another area where a lot of

efforts are being taken.
 Efforts are being made to achieve a better
integration of forward and reverse chains to
improve vehicle utilization and reduce emissions.
Advertising Strategies – to be done by
Surya
 Differentiation Strategies for
GATI
 Focus on Cold Chain Solutions as currently there
are only a handful of players in that segment.
 Amongst the leading players, GATI is the
cheapest logistic service provider, hence a Cost
Leadership Strategy can be adopted by them.
THANK YOU