Logistics Landascape In India After March 2010
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Markash
Mar 27, 2008, 2:16:48 AM3/27/08
to India Supply Chain Professionals
In the last Union Budget, the CST rates were brought down to 2%. This
gives a confidence to government's commitment to phase out CST by
March 2010.
This decision will obviate the existing need of maintaining CFA or
Depots in every state to avoid double taxation. This is going to
change the entire logistics landscape in the country. This will
provide a huge opportunity to reduce logistics cost (10% - 15%) by
consolidation of warehouse infrastructure. Currently, all consumer
goods companies operate 20 to 40 warehouses in the country, that can
come down to 5 t0 10 progressively. This would also mean that small
players will be out of the scene and big 3PLs will take over the
majority of logistics business.
Is the logistics industry preparing itself for the change, well in
advance? What are the challenges ahead?
gives a confidence to government's commitment to phase out CST by
March 2010.
This decision will obviate the existing need of maintaining CFA or
Depots in every state to avoid double taxation. This is going to
change the entire logistics landscape in the country. This will
provide a huge opportunity to reduce logistics cost (10% - 15%) by
consolidation of warehouse infrastructure. Currently, all consumer
goods companies operate 20 to 40 warehouses in the country, that can
come down to 5 t0 10 progressively. This would also mean that small
players will be out of the scene and big 3PLs will take over the
majority of logistics business.
Is the logistics industry preparing itself for the change, well in
advance? What are the challenges ahead?
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