Indian ecommerce giant Flipkart is planning to set up a 4.5 Mn square feet state-of-the-art logistics park in Bengaluru.
The company claimed, in a statement, that the logistics park will house several Flipkart fulfilment centres, improve supply chain efficiency and reduce costs by deploying mechanised warehousing, acting as a freight aggregation and distribution hub, and by leveraging technology for intelligent transport systems.
To set up the park, Flipkart intends to acquire around 100 acres of land, which is either government or privately owned, on the outskirts of Bengaluru, and well connected by road to the nearest National Highway.
In the statement, Flipkart highlighted that Karnataka is a natural choice for the logistics park as the “state’s business-friendly policies have acted as a growth catalyst for Flipkart over the past decade”.
Also, a logistics park near Bengaluru would help the company to cater to diverse industries across the four regional states.
On the development Amitesh Jha, Head of Flipkart-owned Eart Logistics told ET, “Supply chain and logistics are long-term bets with consolidation of warehouses in the key locations as a way forward. We are looking at the next 10 years as we build multiple centres for various categories within the logistics park.”
The company also highlighted the following benefits of the logistics park:
- The logistics park will create 5K direct jobs and 15K indirect jobs.
- It will offer enhanced storage and supply chain capacity.
- Rural development through construction, increased settlement, connectivity and education.
- Rural skill development through upskilling employment in high-tech industry.
- The park will be a net power exporter by deploying solar panels on warehouse roofs
- The logistics park will be carbon neutral and will save water through rainwater harvesting (RWH).
- Non-polluting industry and waste recycling facilities.
The company also quoted World Bank’s report that logistics cost in India is among the highest in the world. Logistics in India account for 14% of total value of goods compared to 6%-8% in developed economies.
With the high-tech logistics park, the logistics industry is expected to get a jump start due to the extent of investments required to set up the park. The park also adds to government’s Logistics Efficiency Enhancement Programme (LEEP), by which multi-modal logistics hubs will be developed throughout the country.
Also, for future expansion, the company expects that the logistics park will enable smaller hubs in multiple cities to create a hub-and-spoke model, the standard followed by logistics industries globally.
Flipkart’s arch-rival, multinational ecommerce player Amazon recently opened 15 fulfilment centres for its hyperlocal grocery delivery arm, Amazon Now. With the addition, Amazon now has 56 fulfilment centres across 13 states with a storage space of 13.5 Mn cubic feet.
Amid the growing online dependence, plans of Flipkart to open its own logistics park in Bengaluru is bound to give it an edge over its competitors.