GST will transform the business landscape, as FMCG and consumer goods firms remodel their operations into bigger, efficient supply chains. Earlier tax laws had imposed significant costs on inter-state movement of goods.
❡—Small and ill-equipped storage will give way to neatly stacked, air-conditioned warehouses with high levels of automation. Firms are likely to close 1-2 small warehouses in each state, and instead consolidate operations into new facilities of 450,000-500,000 square feet, that are 5 times the biggest warehouses right now ❡.
RE developers have started the build out of such facilities.
◉ Warehousing costs are set to fall due to GST. For consumer durables and FMCG, fall is likely to be 50% and 25% respectively. Warehouses will be much larger but numbers will fall by avg 15 per company.
◉ Warehousing will gravitate to consumptions hubs of Mumbai, NCR, Bengaluru, Hyderabad and Kolkata. Haryana and Assam will emerge as new hubs according to Crisil rating agency.
◉ NCR will see highest consolidation as it has the most number of big cities lying within 250km. Haryana is preferred over Ghaziabad, UP because it is outside Delhi, within easy reach of Punjab, Rajasthan, Uttarakhand, HP and well connected to GQ. Beside Haryana is an attractive market where land is cheap and readily available.
◉ Guwahati is ideally located to cater for NE region because it is centrally situated and well connected by logistics. However high land costs and narrow, congested roads will limit the coverage.
◉ Nagpur and MP will probably lose out because they are more than 800km from manufacturing or consumption markets.
https://economictimes.indiatimes.com/industry/cons-products/fmcg/warehousing-cost-for-fmcg-white-goods-to-dip-25-50-report/articleshow/62195121.cms
❡—Small and ill-equipped storage will give way to neatly stacked, air-conditioned warehouses with high levels of automation. Firms are likely to close 1-2 small warehouses in each state, and instead consolidate operations into new facilities of 450,000-500,000 square feet, that are 5 times the biggest warehouses right now ❡.
RE developers have started the build out of such facilities.
◉ Warehousing costs are set to fall due to GST. For consumer durables and FMCG, fall is likely to be 50% and 25% respectively. Warehouses will be much larger but numbers will fall by avg 15 per company.
◉ Warehousing will gravitate to consumptions hubs of Mumbai, NCR, Bengaluru, Hyderabad and Kolkata. Haryana and Assam will emerge as new hubs according to Crisil rating agency.
◉ NCR will see highest consolidation as it has the most number of big cities lying within 250km. Haryana is preferred over Ghaziabad, UP because it is outside Delhi, within easy reach of Punjab, Rajasthan, Uttarakhand, HP and well connected to GQ. Beside Haryana is an attractive market where land is cheap and readily available.
◉ Guwahati is ideally located to cater for NE region because it is centrally situated and well connected by logistics. However high land costs and narrow, congested roads will limit the coverage.
◉ Nagpur and MP will probably lose out because they are more than 800km from manufacturing or consumption markets.
https://economictimes.indiatimes.com/industry/cons-products/fmcg/warehousing-cost-for-fmcg-white-goods-to-dip-25-50-report/articleshow/62195121.cms
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