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The Logistics Industry

Globally, the logistics industry is valued at US$ 3.5 trillion. The U.S., which contributes to over 25% of the global industry value, spendsclose to 9% of its GDP on logistic services.

The Indian Logistics Industry is presently estimated at US$ 90 billion. (CII)

The industry has generated employment for 45 million people in the countryin comparison with the IT and ITeS sector which employs approximately4.3 million people.

It is forecast to grow at a Compound Annual Growth Rate (CAGR) ofapproximately 8% over the next three to five years. (CII)

Third Party Logistics (3PL) Solutions, is slated to grow at a compoundannual growth rate (CAGR) of over 16% from 2007-10. Consequently,3PL service providers are expected to corner an increased share of the IndianLogistics pie, from 6% in FY06 to 13% in FY11, at a CAGR of 25% (CII).

The primary growth drivers of this industry are as under:

o Investments in the infrastructure sector amounting to US$ 350 billion:Increased efficiency and productivity of the transport system wouldresult in lower transit times.

o Streamlining of the indirect tax structure:The introduction of Value Added Tax (VAT) and the proposedintroduction of a singular Goods and Services Tax (GST) are expectedto significantly reduce the number of warehouses manufacturers arerequired to maintain in different states, thereby resulting in a substantialincrease in demand for integrated logistics solutions.Dewan P.N. Chopra Consultants Private Limited

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o Robust trade growthStrong economic growth and liberalization have led to considerableincrease in domestic and international trade volumes over the past fiveyears. Consequently, the requirement for transportation, handling andwarehousing is growing at a robust pace and is driving the demand forintegrated logistics solutions.

o Globalization of manufacturing systemsGlobalization of manufacturing systems coupled with advancements intechnology are increasingly compelling companies across verticals to

concentrate on their core competencies and avail the cost savingpotential of outsourcing. This is expected to contribute to an increase inthe need for integrated logistic solutions, which is the niche of everyThird Party Logistics Service (3PL Services) provider.

The industry has been valued at US$ 125 billion in 2010. (CII)

A snapshot of the FDI regulations governing the industry is as under:i. 100% FDI under the automatic route is permitted for all logisticservices except services mentioned in points ii and iii below.ii. FDI up to 100% subject to FIPB approval is permitted for courierservices.iii. FDI up to 49% under the automatic route is permitted for air

transport services, including air cargo services. It is pertinent tomention in this context, that Press Note 1 (2007) that is expected to beimminently notified by the DIPP proposes to increase the limit of FDI


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on air cargo services in 74%.

The industry has been at the receiving end of increasing interest from theprivate equity sector. The year 2007 witnessed just under US$ 1 billion inprivate equity investments in this industry, representing approximately 7% oftotal private equity investments during the year, against 3% in the previousyear.

Logistics industry in India is an industry that has not achieved its much deserved attention or recognition. It is an area that is ripe with potential and yet the resources are far from complete utilizations. There is however a huge demandfor logistic services in India especially with the growth of the Indian economyalong with the influx of new companies in sectors that was otherwise unknown. Estimated at a value of $14 billion US dollars this industry is slated for another9% to 10% growth in the years to come

Purpose of Logistics Industry

The purpose of logistics industry is to enable an effective transportation or timely movement of goods from one place to another. This could be for the purposeof industrial transportation or even private purposes.

There are three mediums of logistics services in India. These can be categorizedin the following way:Air freight this is a modern and the safest mode to ensure a fast delivery of goods. A chosen one by many because of the swiftness of the system there are manycompanies that are now even providing super fats deliveries by airways even on the same day.Land transport this is a means of logistics support that has withstood the testof time through the extensive network of roads in India. It has been the popular

ly used method and used especially in the shipments of heavy articles like machinery and vehicles. This is also a chosen method in case of household packers andmovers.Railways this is also an age old method of shipments and transport. Though mostused in case of domestic services this is very effective in the availability ofcost effective logistics support in India.Waterways an essential part of this industry this is also one of the oldest methods. Shipments and transportation of goods is done on an international basis through this way. It is apt in case of shipments of oil, highly sensitive or volatile articles like Uranium.

Big HurdlesLogistics is still a nascent and fragmented industry in India. It is estimated that while outsourced logistics accounts for 54% of total logistics spending in India, organized players have only 10% of the pie. In road transportation, whichaccounts for the biggest portion (36%) of logistics spending, 74% of operators are small-time players owning a single vehicle. In outsourced warehousing, 92% ofplayers are from the unorganized sector. Even among the organized logistics players, few have offerings across multiple modes (air, water, rail and road) and services (transportation, warehousing and value-added services such as packaging,cold chain and customs clearance).

A lack of adequate infrastructure and complex taxation and regulations are big hurdles. For example, most domestic airports don't have adequate cargo terminal f

acilities.Moving cargo by road has its own set of problems. National highways form only 2%of India's road network, but they handle more than 40% of road freight traffic.


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This naturally leads to traffic jams. Regulatory requirements and cumbersome documentation also compromise speed. "On average, a commercial vehicle in India runs at a speed of 20 miles per hour. In Western Europe and the USA, the average speed is over 60 miles per hour," notes Vineet Kanaujia, general manager at Safexpress,Moreover, India's tax system is complex. To avoid multiple taxation, companies typically have warehousing operations in every state. The result is a large numbe

r of small warehouses across the country that lack the latest warehousing processes and technologies and don't offer economies of scale.

According to Narayanan Ramaswamy, executive director at KPMG Advisory Services who follows the industry closely, "Infrastructure constraints and a piecemeal approach have resulted in non-conducive policies and avoidable hurdles. What the country needs is integrated logistics planning." N. Viswanadham, executive director at the Center for Global Logistics and Manufacturing Strategies at the IndianSchool of Business in Hyderabad, adds: "The planning problem with Indian logistics is the lack of [an] 'ecosystem' outlook in building facilities, attracting investments and building up stakeholder groups."

Betting on Hub-and-spokeYet not all is gloom and doom. Despite the limitations, industry players see strong potential. Several initiatives and projects are under way to boost development of roads (including the Golden Quadrilateral, North-South and East-West Corridors), ports (Pipavav, Mundra and Dhamra), and airports (Bangalore, Hyderabad, New Delhi and Mumbai). The complex central sales tax is expected to be phased outin coming years. The emergence of India as a manufacturing hub, growth of the organized retail industry, increased domestic consumption, and multinationals bringing in global best practices are all expected to boost the logistics industry."The logistics industry in India is transforming from a conventional storage-transportation concept [to] being perceived as a better way of managing the supplychain and a strategic tool for growth and competitiveness,"

eg:

When Gopinath launched Air Deccan in 2003, only 1% of Indians traveled by air. By the time he sold his venture to industrialist Vijay Mallya in 2007, the figurehad jumped to 5%.Gopinath notes that many times in Air Deccan's early days, a flight cancellationcould be attributed to the lack of adequate logistics services in India. A spare part would come from somewhere in the world to Mumbai within 24 hours, but then, within India, several days would be needed to complete the journey. More often than not, Gopinath wouldn't know how long it would take for the part to arrive. Once it took seven days to move a spare engine from New Delhi to Kolkata; it was cheaper to transport it via Singapore.Gopinath's experience largely sums up the state of the logistics industry in India: inefficient and expensive. Industry players and analysts say logistics costsin India are among the world's highest -- accounting for 13% of GDP, accordingto a report by KPMG. That is far greater than in the United States (estimated at9%), Europe (10%) and Japan (11%). Outside of the metros and a few cities, thetiming of deliveries is uncertain.Different mediums of Logistics services in India

Gopinath, for one, is betting big. He is creating India's first hub-and-spoke distribution model for express logistics. A 100-acre state-of-the-art cargo handli


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ERP, Customer Service, Space Control and Reservations.

Blue Dart Aviation, dedicated capacity to support our time-definite morning deliveries through night freighter flight operations.

A countrywide Surface network to complement our air services.

Warehouses at 53 locations across the country as well as bonded warehouses atthe 7 major metros of Ahmedabad, Bangalore, Chennai, Delhi, Mumbai, Kolkata andHyderabad.

ISO 9001 - 2008 countrywide certification by Lloyd's Register Quality Assurance for our entire operations, products and services.

Ecommerce B2B and B2C initiatives including partnering with some of the primeportals in the country.

Our Competitive Advantage lies in:

Our vast and unparalleled Domestic NetworkLinked by some of the most advanced communications systems and positioned to offer a consistent, premium, standardized quality of service.

A spectrum of services to provide customized solutions.We are the only express carrier in the country today which offers an entire range of services that extend from a document to a charter-load of shipments. Our services are relentlessly monitored to deliver a net service level of 99.96%.

Our Customs and Regulatory expertiseWe have a dedicated team of specialists who provide the expertise for customs as

well as regulatory clearances at all States within the country, to support seamless service to the customer.

Our TechnologyDesigned to enhance the reliability of our operations and process efficiency, and add value to the customer through time and cost savings.

Our Air NetworkThe only one of its kind in the country today, that is focused on carriage of packages as its prime business, rather than as a by-product of a passenger airline. A dedicated aviation system to support Blue Dart's services is self-sustaining, with its own bonded warehouses, ground handling and maintenance capability.

Our financial credibilityFitch Ratings India Pvt. Ltd. has assigned the highest "F1+(ind)" [F one plus (ind)] rating for our short term debt programme of Rs. 30 crores.

Further, ICRA Ltd. has also assigned the highest "A1+" (pronounced A one plus) Rating for our Commerical Paper Programme of Rs. 25 crores.

Our People forceCommitted, diverse and over 6,031 strong are our most valued asset. All our achievements have been possible because we have a team who believes in themselves and their company, a team with a winning attitude. We are a learning organization,we value self-development, and most of our managers are homegrown.

Dart Technology


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Blue Dart has been the only Indian Air Express Company that has invested extensively in Technology infrastructure to create differentiated delivery capabilities, quality services and customised solutions for the customer.

Some of the technology-based business offerings on our site are as follows :

TrackDartTMMailDartTMMobileDartTMInternetDartTMShopTrackTMPackTrackTMShipDartTM

BillingSchedule a pickupWaybill GenerationLocation Finder

Transit Time FinderPrice FinderCOSMAT IISMARTImageDart

We have one of the largest private computer networks in India, with over 3,465 computer terminals connected by dedicated leased lines, VSATs and Microwave links. Our E-mail is accessed at 148 locations daily by over 3,755 users. We also employ wireless, mobile telephones, radio sets and pagers extensively to enhance our communication speed and connectivity with our troops on the field. Our Customer Service Cell is equipped with Automated Call Distribution Systems (ACDs) to pr

ovide quick response and support to our customers.

We are the only Indian express company to have indigenously developed COSMAT IITM, which includes an advanced state-of-the-art track and trace system for all our consignments. Consignments are scanned from pick up to every transit point till delivery, using bar coding and laser scanner technology, transmitting updatesautomatically to our Oracle database. This enables our customers to receive real-time, complete and accurate information about their consignments.

For our aviation system, our in-house team has developed SMARTTM (Space Management Allocation Reservations and Tracking) for effective space and revenue management.

2} DHL:Since its entry into India in 1979, DHL (Dalsey, Hillblom and Lynn) has studied the industry requirements in India and was aware of the growth potentialof the logistics industry. Despite being the market leader in the INR 800 croreIndian express and logistic industry with a market share of 65%, due to increased competition, DHL is trying to grow further to consolidate its leading positionin the industry by exploring new niche markets.

DHL increases its market share in India by repositioning itself as a niche, industry specific, solutions provider.

DHL provides express delivery of applications worldwide with CitrixDHL is the global market leader in international express shipping, overland transport and air freight, as well as ocean freight and contract logistics. DHLs inte


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rnational network links more than 220 countries and territories worldwide. Around 285,000 employees are dedicated to providing fast and reliable services in 120,000 destinations on all continents. DHL is 100-percent owned by Deutsche Post World NetDHLs business is highly dependent on IT services, whose contribution is key to the achievement of our business strategy, said Luc van Hoof, global director, Desktop & Collaboration at DHL Global IT Services. Each business transaction generates

many IT transactions, and you could say that the information about parcels is more important than the parcels themselves. Enabling global delivery of applications and access to this vital information improves our time to market. IT is thebackbone of the business.He continued, As a result of mergers and acquisitions, we really needed to consolidate and centralize IT and optimize the utilization of our infrastructure to improve IT support and business processes. With 2,600 business application serversin 350 server locations worldwide, we literally have all possible end-user devices and operating systems. We also use any kind of network connection and you will find almost any technology available on the market, including Citrix Presentation Server. DHL decided to optimize, centralize and consolidate IT to realize ascalable, reliable and flexible environment that reduces costs.

The most important application at DHL is used for loading aircraft at the sorting hubs of many airports. This application is also used to forward information about parcels to customs for clearance at the destination airport, so that officials know what is coming before the companys airplanes arrive. Application deliveryto airport hubs is extremely time-critical in the DHL Express division. For example, even an hours downtime of this application during peak hours at the BrusselsAirport costs us millions of euros. Without this shipment application, our airplanes cannot depart. Previously, outages occurred more frequently and it took longer to fix any issues. With Citrix load-balancing capability, the chance of downtime is much less than before

E-Strategy to E-BusinessIntroductionMost companies are in some waypreparing or operating an e-strategy insupport of their drive to exploit theopportunities of the online market. Thissection looks at the challenges inimplementing an e-strategy in a mannerthat results in the evolution of a businessto an e-business in a business-drivenand managed way.

The E-Strategy provides vision, goalsand objectives to the organization. Theunderlying driver of the strategy shouldbe the creation of a real time integratedorganization that supports and addsvalue to its customers better than anyother supplier in the market.

"You would see substantial investment in future-not only brick-and-mortar but also in people. We have never realised the full potential of the Indian market sofar," DHL

s Asia Pacific area director Bryan Jamison told FE. Mr Jamison said ofthe 16 countries in Southeast Asia, India was the largest market for DHL in ter

ms of revenues. The company is the market leader in the international air express market in the country, with a market share of more than 60 per cent.


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DHL

s growth strategy revolves around investing in infrastructure, service offerings and people, he added.

It has a 38 per cent share of the global air express services market and last week announced a sales alliance with India

s largest express courier company, BlueDart (which incidentally also has a 38 per cent share in the domestic market),for latter

s outbound requirements. So, does a tie-up with Blue Dart open up the

possibility of an equity alliance or a joint venture between the two companies?Mr Jamison was non-committal.

DHL has been in the Indian market, which recorded a double digit growth after the slowdown triggered by the terrorist attacks in the US on September 11 last year. Founded in 1969 in the US, DHL operates in more than 220 countries and territories. Mr Jamison said DHL has over the years evolved from a

courier

to a `carrier

company and now as a `solutions provider

3} GATI one of the pioneering companies in the field of logistics. This is one the companies that have taken several initiatives to implement modernization in t

he area of logistics. With a turnover of Rs. 576 crores this company believes insetting new standards of customer service.

Others who tried running cargo airlines gave up. Gati, a multimodal player withmore than 4,000 vehicles and six marine vessels, is among them. Mahendra Agarwal, managing director and CEO, attributes the decision to "commercial bottlenecks." Gati, he says, initially wanted to have its own cargo aircraft. However, facedwith regulatory issues and a lack of expertise in running cargo aircraft, it chose to outsource two freighters from Air India. "We had a successful operation of these two freighters regularly on the Chennai-Delhi route," he says. "While operating [them], we realized certain commercial bottlenecks and therefore decidedto close the operation for the time being."For now, Agarwal has other priorities. He is expanding his range of value-added

services, focusing on small and mid-size enterprises and key retail markets, creating deeper inroads into city and tertiary distribution, and developing industry-specific expertise.

4} DTDC this company spreads over 3700 locations within India and 240 international places. The company is a leading name in low cost shipments along with timely delivery.

DTDC Core SolutionsDTDC has deployed state of the art Technology backed by efficient operations infrastructure to provide efficient services to all its customers. The High End ITcapabilities deployed ensure tracking each consignment at every touch point right from booking till delivery. The data is available on the web for customers update.

Corporate customers are provided customized solutions to meet their service requirements and an efficient MIS support by way of timely automated reports are provided to keep track of their large number of shipments effortlessly.

Customer Value AdditionsCustomers can directly track their consignments at our web site.We have special computer based booking procedures so that bulk consignments canbe handled efficiently.

Customers can directly track their consignments at our web site in http://www.dtdc.in/subpages/tracking/domestic.asp using our Consignment numbers or their own


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reference numbers.We provide group tracking for special customers so as to improve their efficiency.Our tracking is also available to GSM and CDMA mobile users through SMS.We can address customized data requirements of our users, apart from the abovefacilities.We have special computer based booking procedures so that bulk consignments can

be handled efficiently.We make extensive use of bar code scanners and electronic weighing machines across our entire network to ensure accuracy and integrity of transactions, which ensures safe and efficient transshipment of your parcels and documents.DTDC provides customized solutions to meet the requirements various industry verticals.

InfrastructureOur electronic network is easily the largest in the country for this segment ofindustry We have over 300 POPs who can link with our central database. Our wide area network provides synergy too our large physical network, which is our USP

.We use heterogeneous modes to link to our central database - leased lines, Digital Subscriber Lines (DSL), Cable and dial up lines.We have few Servers and many desktops running diverse applications. At our Corporate Data Centre at Bangalore, multiple Xeon processor based IBM Servers, ASICbased Firewalls and Enterprise Class Gateway anti-virus solutions are deployed.

We have an efficient and strong email network across the country for a better and fast communication.We handle close to 400 million transactions on our IT systems.

Blue Features Assured Second Business Day delivery *

100% Money Back Guarantee if not delivered within committed delivery period* Service to locations beyond DTDC plus lanes Tamper-proof Security Pouch* Second Business Day Delivery means any consignment picked up on day one will be delivered on day three barring unforeseen circumstances (including force majeure) and provided that day of delivery does not fall on a Sunday, public holidayor any local holiday at the destination city

Blue ServiceINTRA ZONEZonal Blue : SBD delivery available within North, East, West & South zones to select Pincodes.INTER ZONEMetro Blue : SBD delivery available for 6 metropolitan cities of Delhi, Kolkata, Mumbai, Bangalore, Chennai & Hyderabad from other locations.National Blue : Second Business Day delivery available between 4 Zones to select Pincodes at non-metro locations

Blue Support Dedicated desk at each DTDC Regional Office. E-mail alert to sender giving delivery confirmation. SMS alert to sender giving delivery confirmation.

To get the DTDC Blue Serviceable pincode status, send a SMS in the format

BLUE

to the number: 9845324040. For Ex: BLUE560047 600001 and SMS to 9845324040. This is valid for Reliance phone too. Pleas


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e provide one space between

BLUE

and

ORIGIN PINCODE

and one space between

ORIGIN PINCODE

and

DESTINATION PINCODE

.

Awards Galore to Man of Excellence

- Mr. Subhasish Chakraborty, Chairman & Managing Director- DTDC Courier & Cargo was recognised & rewarded by many Institutions for hi

ghest excellency in the field of Business & Innovation

Corporate Profile...Technology Clientele

TelecomIT / ManfuacturingBanksInsurance / Financial sectorFMCG & consumer durables

HealthcareTechnologyAutomobileTextiles

TelecomAirtelAlcatelAircelBharati CellularBSNL

HUTCHIdeaReliance InfoTata IndicomVodafoneVSNL

IT And ManufacturingABBBharat ForgeBHELGodrejLarsen & ToubroMurugappa GroupNICCOSigma AldrichThermax

BanksAndhra BankAxis BankBOBCanara BankCiti Bank

HDFC BankIndian BankSBI


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UCO BankING Vysya BankInsurance AndFinancial sectorBirla SunlifeICICI PrudentialING Vysya Life

LIC of IndiaMax New York LifeOriental InsuranceReliance LifeTata AIGUnited Insurance

FMCG And ConsumerDurablesAmway

BataBritanniaHLLParleGEHyundaiLGPhilipsSony

HealthCareDr. Reddys LabsGerman Remedies

HimalayaManipal AcunovaMedi AssistNicholas PiramalNovartisNovo NordiskRanbaxyZydus Cadila

TechnologyDellEpsonHCLHPIBMInfosysPhilipsTCSWiproAutomobileBajaj AutoFord MotorsHero HondaHyundaiMahindra & Mahindra

MarutiSkodaTata Motors


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ToyotaTVS

TextilesArvindDigjam

India PolyfibreIndian TerrainIndoramaJCTLevi

sRaymond

Vision, Mission & Quality policyVision

To be the most Admired and Successful Express Distribution Company in India by meeting and exceeding our Customers

expectation of services.

MissionTo focus on Customer Loyalty and make it the goal of our Organization.To encourage our people for adoption of new technologies, processes and systemsfor improved, reliable and speedy service.To relentlessly monitor to reach a minimum net service level of 98% delivery.

Quality Policy

At DTDC, We are COMMITTED TOWARDS:Satisfied Internal Customers, External Customers and Business AssociatesContinual Improvements in products, Processes, Services and Quality Management SystemsSatisfied, Motivated and committed Employees.

DTDC is one of the largest Indian company in the Express industry, enjoying a market share of nearly Rs 270 crores. Headquartered at Bangalore, with 4 of its Zonal Offices at Delhi, Kolkata, Chennai & Mumbai, DTDC currently serves around 10,000 pincode areas and has over 3,700 Franchised outlets, supported by 176 offices, which includes its Branch offices, Regional offices, Area offices, Hubs andSub-offices.

DTDC has extended its service network to the overseas market and provides services to worldwide destinations using its own branches and international associatesat prime gateways like USA, UK, Singapore, UAE, Nepal, Bhutan, Bangladesh, SriLanka & Hong Kong. DTDC takes the credit of pioneering the franchisee concept for the courier industry in India, and today has the largest franchisee network.

With a strong IT infrastructure, the company is able to deliver 10.5 million parcels per month to customers across the world. DTDC has now set its sight on cros

sing the Rs.500-Crore mark by year 2010.

DTDC has introduced a relatively unique and new concept for the courier companie


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s, for booking consignments at your convenience e-booking @ DTDC. With this concept anyone located at any corner of the country, can visit the DTDC site & log on to the e-booking link. You can now send documents from home or office in 3 easy steps. Book. Pay. Print.

The e-booking is a convenient new service for people who need to send packages weighing upto 250 grams. Book you consignment by login in to DTDC site with a pas

sword. Create the details of the consignment and then make payment through our Internet Payment Gateway either with your Credit / Debit card (128 bit encryptedfor the safest transaction). Print a copy of the Bar-coded Consignment Note anddrop the consignment at your nearest DTDC center. You can also Track & Trace your consignment on the website.

DTDC in India......The Company-owned Branch typically covers a specific range of Pincodes, which

have been predetermined for purpose of effective deliveries. Coverage of the Pincode range is handled by way of assigning a dedicated Franchisee for each Pincode, who covers the geographical expanse falling under the subject Pincode. The ov

erall performance of the deliveries for the range of Pincodes assigned is takencare of by the DTDC Branch.

Regions

AHMEDABADBANGALORECHENNAICOCHIN

HYDERABADKOLKATAMUMBAINORTHERN ROPUNE

Domestic...

You can track all your Domestic Consignments sent via DTDC.Please enter the required information below and press the corresponding button to track your Consignment.

Domestic Tracking (All INDIA Shipment)DTDC Consignment No. Shipper

s Ref. No.

To track multiple Consignments, enter maximum Ten (10) Consignments seperated by comma ( , ). If the Consignment No does not start with an alphabet, please add X before the


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Consignment No. Omit asterix (*) if any in your consignment number.

SMS TrackingTo get the current status of your consignment, send a SMS in the format

DTDCConsignment No.

to the number: 9845324040. For Ex: DTDC D03033703 and SMS to 9

845324040. This is valid for Reliance phone too. Please provide one space between

DTDC

and

Consignment No.

DTDC Domestic Locations

New Features :For checking Pincode, please send SMS as

PIN pincode

to 9845324040. For Ex:PIN 700019 to 9845324040

For checking serviceable City, please send SMS as

CITY City Name

to 9845324040

. For Ex: CITY Agra to 9845324040

Customer Service Phone No.We value your Feedback.

5} Safexpress, meanwhile, has zeroed in on warehousing. The company has more than 5 million square feet of warehousing space across the country and is planningto set up 32 state-of-the-art logistics parks and add another 5 million square feet in the next two years. Five of these parks are already operating. Says Kanaujia of Safexpress: "With the phasing out of the central sales tax, we expect to

see a huge demand for world-class warehousing in the country."

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