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INTERVIEW

"We plan to put 10000 SmarTrucks, hire 20000 drivers"
Monday, 19 November, 2018, 08 : 00 AM [IST]
DHL SmarTrucking is a business unit of DHL eCommerce, a division of Deutsche Post DHL (DPDHL) Group.  DHL SmarTrucking is an innovative logistics company, which is committed to providing reliable and easy road transportation services in an innovative and agile way. The company’s operating model provides simple, fast, reliable and 24/7 road logistics across India. Its fleet is enabled with state-of-the-art-technology for both ambient and temperature-sensitive products that cater to industries such as e-commerce, automotive, dairy, consumer durables, packaged foods, pharmaceuticals, electronics, chemicals, apparel and quick service restaurants (QSRs).

In an email interaction with Anurag More, Neeraj Bansal, CEO, DHL SmarTrucking pointed out how the industry has become an integral part of the supply chain industry comprising refrigerated storage and refrigerated transportation, its growth going forward and more. Excerpts:

What is the current scenario of cold chain market in India?
The cold chain segment in India is developing at a rapid pace, mainly due to the shift in focus from increasing production to improving storage and transportation facilities. The industry has become an integral part of the supply chain industry comprising of refrigerated storage and refrigerated transportation. The demand for cold chain logistics from organised retail, pharmaceutical industry and the e-commerce space has been growing day-by-day, thereby increasing the demand for cold chain solutions in India.

Where does India stand compared to developed countries for cold chain?
According to the Global Cold Chain Alliance (GCAA), an industry group representing temperature-controlled logistics companies, the cold chain in India is expected to grow over the next five years with a compound annual growth rate (CAGR) of 13-15%.

This growth is visible today as companies and consumers are increasingly looking for convenience and round-the-clock availability, driving the demand for novel cold-chain packaging and delivery solutions. The emerging demand from the processed food and quick service restaurant industries is testimony to this growth. In India, pharmaceutical, dairy and confectionery, and processed foods are the key emerging sectors in the cold chain segment. At DHL SmarTrucking we have road freight solutions for these industries as well as others like quick service restaurants, meat and poultry, fresh produce (fruits and vegetables), food service and e-commerce.

How are the policies in India for cold chain?
In the last few years we have seen the introduction of a number of policies that are directly and indirectly supporting the growth of the cold chain segment in India across industries. The Ministry of Food Processing Industries (MoFPI) is implementing a scheme for Creation of Infrastructure for Agro Processing Clusters under Pradhan Mantri Kisan Sampada Yojana to create modern infrastructure for food processing in the country. Another initiative from the government is the Mega Food Park project that aims at providing a mechanism to link agricultural production to the market by bringing together farmers, processors and retailers so as to maximise value-add, minimise wastage, increase farmers income and create employment opportunities particularly in cold chain logistics.

There are also compliances related to trucks and temperature regulation. As part of a leading global logistics player, our SmarTrucks are FSSAI-compliant and adhere to the latest ISO standards in the cold chain industry. Our trucks are compliant with cold chain transportation regulations, Good Distribution Practice, US Food and Drug Administration and 21 CFR-compliant telematics solutions.

What is the outlook for the cold chain market?
A Ken Research report, “India Cold Chain Market Outlook to 2022 - by Cold Storage & Cold Transport, 3PL, End User Industry,” notes that the demand for multi-purpose cold storage, third- party temperature-controlled distribution, regional growth and expansion, surge in ambient warehousing revenue will drive the future of cold chain in India.

The market is highly unorganised and dominated by traditional cold storage facilities. The increasing demand for convenience foods, growth of QSR and also the movement of people from different cities for better jobs and hence growing demand for fast foods has led to advancements in freezing technology and cold chain logistics. All of this is leading to the support of frozen food sales and growth of online grocery stores.

How technology is changing the cold chain in India?
Today’s technology offers a variety of tools to not only keep products at the right temperature, but to also better monitor the load—from temperature sensors and GPS tracking to self-reporting alerts for computers and mobile devices. Smart refrigerated units even help monitor the location, temperature, humidity, and motion of shipments in real time. Advanced tracking abilities give relevant parties advanced warning of any changes or malfunctions with the equipment. These types of notifications can help ensure necessary maintenance is performed regularly or even secure alternate capacity before a load is compromised.

The focus on end-to-end temperature control for all cold chain products is a relatively recent trend in India; until then, temperature control used to be specified and observed only for the storage of a limited range of products. The situation is now changing as transportation regulations across the world evolve. It is time for a new, smarter cold chain – one that is informed by knowledge of the various sectors and international regulations, has robust standard operating procedures, ensures end-to-end visibility and control, and is driven by the latest technologies that deliver competitive advantage.

Tell us about your offerings.
DHL SmarTrucking is focussed on providing trucking solutions across India, which offers the fastest transit times and highest reliability with ease of use, end-to-end consignment visibility, temperature-controlled capabilities and real-time tracking. For instance, DHL SmarTrucking functions with automated solutions that use IoT-enabled sensors. These sensors, through the company’s centralised control tower provide us with real-time temperature and consignment tracking. Information alerts and status updates are also sent to customers and DHL SmarTrucking’s operations teams through the customer portal and external and internal mobile applications. We offer the fastest transit times with 95% reliability, and up to 50% reduction in transit times compared to traditional trucking, along with ease of use, end-to-end consignment visibility, temperature-controlled capabilities and real-time tracking that beats industry standards.

DHL SmarTrucking has the added advantage of being backed by the world’s leading logistics company with extensive network and expertise. Its two-driver relay model facilitates faster transit, enabling shipments to reach their destinations on time.

What makes you different from other players?
Today businesses have become highly competitive and many sectors are changing.

To remain in the reckoning, it is necessary for companies to find innovative ways to differentiate their offerings for their customers. Logistics will be a key element to this differentiation. DHL SmarTrucking can help businesses unlock customer value by supporting their business vision and enabling them to concentrate on their core competencies.

While there are a number of companies operating in this segment in India, there is no single player like DHL SmarTrucking in the Indian logistics landscape. DPDHL Group has been in the logistics space for a very long time, so we are amply supported by a global skilled and knowledgeable team that we are able to leverage to enhance our offerings to our customers.

This heritage as one of the world’s leading logistics providers with around four decades of India experience gives us an advantage when it comes to understanding the Indian customer and contributing to the logistics sector.

Brief us about your expansion plans.
Our aim is to disrupt the logistics industry in India through judicious and progressive use of technology, customised to the industries we serve. This is a long-term commitment and we will continue to invest as much as needed, as India is a key market for DHL. Within few months of our launch, we have more than 700 trucks on the road and we plan to put 10,000 SmarTrucks on the road and hire 20,000 drivers in the next 10 years. These trucks will be IoT-enabled and temperature-controlled which will enhance customers’ inventory management and enable them to reach customers and markets faster. At the moment we are running pan-India operations using a network of 20 SmartHubs spread across the country.

How much will you be investing for the same?
We have an asset-heavy business and we will continue to invest in our technology, employees, vehicles and business needs. Ultimately, our aim is to provide reliability, visibility and a seamless customer experience and DHL SmarTrucking will undertake the necessary steps to ensure this. To support our customers with their logistics requirements and make them successful, we will continuously invest in quality services, innovations and infrastructure.
 
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