India's Future Logistics Solutions to set up 4 cargo consolidation hubs
Future Logistics Solutions (FLSL), the supply chain and logistics arm of Kishore Biyani’s Future Group, has undertaken major initiatives in the transportation vertical. The move is initially aimed at catering to in-house demand, but later will be expanded to others.
The company has decided to set up four major cargo consolidation hubs across the country. Also, the company will increase its transportation capacity with specially design vehicles for volumetric transport. FLSL CEO Anshuman Singh said the transportation will become a special business unit (SBU) for FLSL and targets business of Rs 500 crore in three years.
Mr Singh told ET, “A large number of retail categories such as plastics, luggage, toys, footwear and furniture are volumetric. This leads to extremely high transportation cost since the trucks carrying these goods are grossly under-utilised on weight although the freight is fixed. Being a largest retailer of all these categories, FLSL is now developing its own innovative transportation solutions.”
FLSL operates a fleet of 400 dedicated trucks especially for home deliveries and store deliveries. It plans to increase the number of trucks to 600 in next one year. It will outsource these trucks from transport service providers.
An analyst said the proposed move is expected to help the company reduce transportation costs which may be passed on to the customers. “Also, FLSL may spin off the transportation business into a separate company once it gathers the critical mass. This will help the Future Group to unlock the shareholders’ value,” he said.
Also, the company is technologically upgrading its fleet which includes implementation of GPS (Global Positioning System) devices in all vehicles. This will enable real-time tracking and allow updates to customers about the exact status of their consignments.
The company has decided to set up four major cargo consolidation hubs across the country. Also, the company will increase its transportation capacity with specially design vehicles for volumetric transport. FLSL CEO Anshuman Singh said the transportation will become a special business unit (SBU) for FLSL and targets business of Rs 500 crore in three years.
Mr Singh told ET, “A large number of retail categories such as plastics, luggage, toys, footwear and furniture are volumetric. This leads to extremely high transportation cost since the trucks carrying these goods are grossly under-utilised on weight although the freight is fixed. Being a largest retailer of all these categories, FLSL is now developing its own innovative transportation solutions.”
FLSL operates a fleet of 400 dedicated trucks especially for home deliveries and store deliveries. It plans to increase the number of trucks to 600 in next one year. It will outsource these trucks from transport service providers.
An analyst said the proposed move is expected to help the company reduce transportation costs which may be passed on to the customers. “Also, FLSL may spin off the transportation business into a separate company once it gathers the critical mass. This will help the Future Group to unlock the shareholders’ value,” he said.
Also, the company is technologically upgrading its fleet which includes implementation of GPS (Global Positioning System) devices in all vehicles. This will enable real-time tracking and allow updates to customers about the exact status of their consignments.