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In a sector governed by the faster the better, warehouses play a strategic role in achieving the overarching vision of reducing the logistics cost as a percentage of India’s GDP. The Indian warehousing sector has been witnessing a growth trend marked by expansion and advancements. This surge in warehousing requirements has stemmed from the flourishing manufacturing sector, digital commerce, and evolving consumer demands for faster deliveries.
As per a report by Knight Frank India, India’s warehousing transaction volumes in its eight primary markets reached 56.4 million square feet (mn sq ft) in 2024, marking a 12 per centyear-on-year increase from 50.3 mn sq ft in 2023.
In a sector governed by the faster the better, warehouses play a strategic role in achieving the overarching vision of reducing the logistics cost as a percentage of India’s GDP. These modern facilities serve as critical nodes that enable minimal transit and faster turnaround times, optimizing the efficiency of the supply chain. With the immense growth potential in this industry, let us dive in to explore the ongoing trends in this vertical.
Digitalization – I cannot stress enough on the benefits of adopting tech to optimise warehouses as it is something that greatly affects the entire supply chain by making it organised and efficient. There are multiple software like Warehouse Management System (WMS) that help in a wide range of tasks from managing inventory and stock levels to analysing which set needs to be cleared first basis the product specifications such as expiry date. It even helps you in locating the consignment which makes managing large warehouses simpler.
Focus on renewable energy powered warehouses – As the world becomes aligned towards a common goal of reducing carbon emissions, the focus on renewable energy powered warehouses in the logistics industry remains no longer just a trend but a long-term movement that will rigorously expand for several decades. Companies are investing in warehouses that use sustainable alternatives such as renewable energy sources like solar energy for electricity generation, sustainable building materials for construction, sustainable packaging solutions and optimized layout to store more goods in less space.
Micro-Fulfilment Centres (MFCs) – The demand for e-commerce is rising significantly in India and it is no longer prominent in just tier – 1 cities. To cater to this, companies especially in the quick commerce sector are increasingly setting up their micro-fulfilment centres to ensure quick deliveries to their end customer.
These centres contain a large variety of goods in limited numbers and are equipped with advanced technologies for lightning-fast processing. Their locations (generally at the heart of the city) are determined by their accessibility to consumption and manufacturing zones to minimize first and last mile delivery time.
Expansion into Tier II and Tier III Cities – Tier II and tier III cities are emerging as crucial regional distribution centre, reshaping India’s supply chain landscape. With a large consumer base developing there and perks like availability of both, affordable land and labour, logistics players, private companies and the government are increasingly investing in building warehouses in the tier II and tier III cities.
Moreover, the implementation of Goods and Services Tax (GST) enabled CDC (consolidation centre) & RDC (regional distribution centre) model has further opened ways for companies to set up warehouses closer to their customers at the intersection of their pan-India distribution networks.
Temperature-controlled warehouses – Another trend that is gaining momentum is the requirement for temperature-controlled warehouses that are used for storing perishable goods like food items and pharmaceuticals that cannot withstand room temperature.
As per a report by grandview research, the global cold chain warehousing market which was valued at $85.04 billion in 2022 is estimated to grow at a compound annual growth rate (CAGR) of 17.8 per centfrom 2023 to 2030. To maintain the required environmental conditions, IoT devices and sensors are used to continually monitor the temperature range and humidity level which helps in ensuring the maintenance of optimum conditions for goods.
The Indian warehousing sector stands at an exciting juncture with increased domestic consumption, digitalization, and proactive support by the government which is driving the future of the industry. India’s warehousing market has remained resilient despite global tensions in trade.
This inherent strength, coupled with the ongoing adoption of innovative solutions and a commitment to sustainability, positions the Indian warehousing sector as a crucial enabler of economic growth and a compelling destination for both domestic and global investments, poised to navigate future challenges and capitalise on the immense opportunities that lie ahead.
(The author is Daewon Seo, Global Business Executive, CJ Darcl Logistics Ltd. Views are personal.)
- Published On Sep 6, 2025 at 08:21 AM IST
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