How do you evaluate logistics in cement industry?
Logistics in cement industry typically means bulk cargo handling both in the inbound (sourcing) and outbound (distribution) side. Inbound logistics involves transporting limestone and other raw materials that do not involve any notable warehousing and value added activities, outbound logistics involves systematic transportation and storage activities, apart from a few value added services.
What are functional bottlenecks?
Due to the sensitive nature of the product (as cement is prone to damage by atmospheric humidity), outbound logistics involves careful handling of the product both in transportation and storage. The product needs to be weather proof in every stage of its distribution until it finally reaches the end-user. Ensuring its safety across the distribution chain is a major challenge for the cement industry.
Railways haul about 40 per cent of cement, what are the bottlenecks?
Even though railways is the most preferred inland transportation mode for the cement industry, lack of integrated rail connectivity from sourcing locations to plants and again from plants to last mile distribution points is the major issue faced by the industry.
What are the inwards and outwards logistics, the cost proportion?
While cement industry reportedly incurs around 15 percent of its turnover as logistics activities cost, inbound activity accounts for one-third of this cost and the remaining is incurred on outbound logistics.
What are preferred modes of transportation of cement?
As mentioned above, rail is the most preferred inland transportation mode of cement industry (mainly for long distance consignments) because large volume of consignments to major destination(s) across country can be sent in a single consignment. However, since railways are unable to offer end-to-end connectivity, road transportation has emerged as the most used transportation mode by this industry. Coastal shipping is also used in few parts of the country by cement companies.
What are the new challenges in road transport?
Poor road conditions across the country (especially for the last mile distribution) are a major challenge for the cement industry utilising road transportation. Rapid fuel price hike leading to frequent escalation of transport charges is another challenge. In addition, rising toll charges on highways is also adding to transportation costs for the industry.
What is the focus on logistics going ahead?
For the cement industry, the focus or trends that are expected to enhance efficiencies in logistics are: