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According to a report by CBRE, the retail sector has become a major driver of warehousing demand in India, with its share rising from 8% in 2019 to 13% in 2022. The report, revealed that the retail segment's share in the warehousing sector reached 9% in the first half of 2023.
The collective demand for warehousing from e-commerce, FMCG (Fast-Moving Consumer Goods), and the retail sector accounted for nearly 27% of the total demand from 2019 to H1 2023. Within the retail segment, hypermarkets (51%) and fashion and apparel (32%) companies dominated the share of warehousing demand. CBRE anticipates that the retail sector will strengthen in the second half of 2023 due to increased
Retailers are reassessing their supply chains to stay agile, leading to increased demand for warehouse leasing and advanced warehousing solutions. The report also highlighted the growth projections for various retail segments. The fashion and apparel category is expected to expand by over 12 times by 2047, while the FMCG category is projected to grow nearly six-fold by 2027.
To support this expansion, the report emphasized the importance of temperature-controlled storage facilities to maintain product quality. Automated First-In-First-Out (FIFO) rotational methods within warehouses were also deemed crucial to prioritize the sale of older products, minimizing wastage. Additionally, the report predicted that the consumer electronics category would grow 1.5-fold by 2027.
The report underscores the evolving landscape of India's retail industry, driven by changing consumer behaviours and technological advancements. Retailers are adapting their supply chains to meet the demands of a growing customer base, leading to increased warehousing needs, especially in the context of e-commerce and the expansion of retail into smaller cities.
As the retail sector continues to grow and evolve, warehousing solutions tailored to the unique needs of different retail categories, such as temperature-controlled storage for FMCG and efficient inventory management for fashion and apparel, will play a crucial role in supporting this expansion.
This trend reflects the broader shift in the global retail industry towards e-commerce and omnichannel retailing, where efficient logistics and warehousing are essential to meet customer expectations for fast and reliable delivery.
In conclusion, the CBRE report sheds light on the remarkable transformation within India's retail landscape, accentuating the pivotal role of the warehousing sector. With the retail industry's share of warehousing demand steadily rising and projected to strengthen further, it is evident that retailers are proactively adapting their supply chains to meet evolving consumer expectations As India's retail sector continues to expand and integrate with e-commerce, the need for tailored warehousing solutions becomes increasingly vital. This trend mirrors the global retail industry's broader shift towards e-commerce and omnichannel strategies, highlighting the essential role of logistics and warehousing in ensuring rapid and reliable customer service.
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