This document discusses logistics and the supply chain industry in India. It covers: 1) Key topics around government policies and initiatives, industry growth opportunities and challenges, and the role chartered accountants can play in the logistics sector. 2) Several quotes from reports on issues facing the Indian logistics sector like the lack of a single government champion, needed skills gaps, and the need for a national logistics policy. 3) Definitions and objectives of logistics, and differences between providers like 3PL, 4PL, and concepts like logistics integration and opportunities in the Indian market.

1. LOGISTICS
Supply Chain
Shantanu Bhadkamkar
Regional Conference
WIRC
ICAI
Industry Growth, Opportunities, Challenges
Government Policies & Initiatives
Role Of Chartered Accountants

2. “Logistics service providers should join logistics
clusters and actively collaborate with transport
infrastructure operators, governments and academia.
Players in the logistics arena should establish
and foster knowledge exchange and management
across company borders.”
Transportation & Logistics 2030
Price Waterhouse Coopers 2010

3. LOGISTICS-Supply Chain
Govt. Policies/Initiatives, challenges and opportunities.
The expectation is how is the industry growing, what
are the opportunities, challenges and if chartered
accountants can play roll.

4. • “Businesses no longer compete, its Supply Chains
that compete!”
• Professor Martin Christopher
• In 2010 Transport Intelligence identified India as the
world‟s most important growing logistics market

5. “the absence of a single logistics 'champion' (whether in form of a
ministry or otherwise) in the
government (or industry) led to a disintegrated approach to
development of the sector. Extensive
fragmentation meant the incapacity of industry players to develop the
industry as a whole and poor
support infrastructure, such as roads, ports and telecoms, led to a
situation where the opportunity to
create value is limited.”
Skill gaps in the Indian Logistics Sector
KPMG & CII 2007

6. “India will require a National Integrated Logistics Policy (NILP). Such a policy
should target a greater
share of rail, reduce economic waste and improve energy efficiency. The
policy will need to establish
and implement targeted national programmes including dedicated freight
corridors, coastal freight
channels, national expressways, last-mile roads, last-mile rail, multi-modal
logistics parks, road
maintenance, technology adoption, skills development, and equipment &
service standards”
Transforming the Nations Infrastructure
McKinsey 2010

7. “Logistics service providers should join logistics
clusters and actively collaborate with transport
infrastructure operators, governments and academia.
Players in the logistics arena should establish
and foster knowledge exchange and management
across company borders.”
Transportation & Logistics 2030
Price Waterhouse Coopers 2010

8. What is LOGISTICS
Tuesday, April 30, 2013SHANTANU BHADKAMKAR - ATC 8
Logistics is the process of planning, implementing, and controlling
the efficient, effective flow and storage of goods, services, and
related information from point of origin to point of consumption for
the purpose of conforming to customer requirements.
Reference: Council of Logistics Management, http://www.clm1.org/mission.html, 12 Feb 98
Note that this definition includes inbound, outbound, internal, and external movements, and
return of materials for environmental purposes.
Logistics (CEN) The planning, execution and control:
•of the movement and placement of people and/or goods
•and of the supporting activities related to such movement and
placement within a system organised to achieve specific
objectives
CEN : European Committee for Standardization (Comité Européen de Normalisation in French)

9. Tuesday, April 30, 2013SHANTANU BHADKAMKAR - ATC 9
Logistics Objectives
Right Place
Right Documentation
Good Condition
Right Price
Right Time
Right Tariff
Smooth
Movement
Online
Information

10. Outsource Logistics
• We want to outsource logistics :)
• Shippers never owned bullock carts, ships, railways
etc
• What is envisaged is outsourced management.

11. Consilience
Jargon & Acronyms
1pl - xpl
Definition Depends on whom you ask
As many experts as many definitions
DISCLAIMER
You have 2 Economists, you have 3 Opinions.

12. Parties
• 1st Party: The Supplier
• 2nd Party: The Company buying the product that is being
stored or shipped
• 3rd Party Logistics Provider (3PL): The company that provides
warehousing and transportation outsourcing
• 4th Party Logistics Provider (4PL): The majority of people
would agree that 4PL is little more than logistics consultant, but
nevertheless here is the official definition courtesy of
Accenture:
„A 4PL is an integrator that assembles the resources, capabilities,
and technology of its own organization and other organizations
to design, build and run comprehensive supply chain solutions.‟

13. What is 5PL
• 5PL is the alignment of individual supply chains into
a common network strategically managed by a
single body
• Therefore the fifth party itself is not (necessarily) a
physical entity but a system that informs a controlling
party which in turn manages the various supply chains in
the network on the basis of real time information and pre-
aligned logistics facilities such as transport, shipping,
storage etc.
Supply
Chain 1
Supply
Chain 2
Supply
Chain 3
Supply
Chain 4
Supply
Chain 5RM
FINISHED
GOODS
CONSUMER

14. INTEGRATION
SUPPLY CHAIN LOGISTICS
INTEGRATION
COST TIME
TRANSIT WAITING OBSTACLES
RELIABILITY RISKS

15. LOGISTICS
INTEGRATION
• SEAMLESS MANAGENT
• REAL TIME MONITORING
• VISIBILITY
• TRACEABILITY
• SYNCHRONISATION
• MULTI TIER
CHARACTERISTICS
• GLOBALISATION OF MARKETS
• INCREASED COMPETITION
• TECHNOLOGY
• PARTNERSHIPS
• INFRASTRUCTURE
• VENDOR & CUSTOMER DEMANDS
DRIVERS

16. What Is 7 PL?
7PL = 3PL + 4PL

17. What Is 3PL + 4PL
3PL + 4PL = ?
Same as 3½PL
NONSENSE
OR
SOMETHING I DON‟T KNOW YET

19. Heard in Europe
Some Bankrupt Forwarders are now Consultants.
They work on Commission based on COST
REDUCTION.
They Call themselves 4PL

20. 4PL = Asset Free
Is only asset free enough?
3PL Paved Way For Outsourcing
New BPO,
Lead
Logistics
Focuses On
Process
Rather Than
Task
Fills Service Vacuum created by 3PL
4PL is Neutral Brings Value
ReEngineered
Approach

21. VISION
• BUILD ON CORE
COMPETANCIES
KNOWLEDGE
• KNOW HOW
• EXPERIANCE
TECHNOLOGY
INVESTMENT
• PEOPLE
• PROCESSES
IMPLIMENTATION
• NEUTRAL
• COMMITMENT
• PARTNERSHIP
RECIPE

22. 3PL
Carriers
• Airlines
• Shipping Lines
• Rail
• Truckers
• Courier
• Post
Infrastructure
• Port
• CFS
• Warehouses
• IT
Customers
• Buying Agents
• Manufacturers
• Merchants
Organisors
• CHA
• IATA
• MTO
• NVOCC
• Liner Agents
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CONVERGENCE IN LOGISTICS

23. SHANTANU BHADKAMKAR - ATC
Pricing,
Costing,
Forecasting,
Feed Back
MIS, Response
Management
Concept Selling
& Enhanced
Role Of
Marketing
Ability To
Handle New
Unexpected
Situations
Dealing With
Uncertainty
Global Alliances
& Strategic
Networking
Better
Management Of
Finances
Strategic Global
Vision
Quicker
Delivery
Lower Cost
Superior
Service
Range
Flexibility Visibility
TraceabilityIntegration
Tuesday, April 30, 201323

24. Technologies
• Information
Management
• Full
Integration
with
Customer’s
ERP
• Middle Ware
• RFID, Bar
Coding …
Enhanced
Safety
Standards
• Hazards
• Accidents
• Health
• Safety
Culture
• Monitoring,
Review &
Audit
Security
• Domestic
• International
• Storage
• Carriage
• Personnel
Environmental
Issues
• Statutory |
Compliance
• Packing
• Green
Logistics
• Reverse
Logistics
• Carbon
Credits
Fuel
• Costs: Rise &
Volatility
• Particularly
Fossil Fuels
• Peak Oil
• Alternative
GLOBALISATI
ON
• Opening Of
Markets
• Global
Manufacturin
g
• Various Local
Laws
• Various
International
Conventions
Tuesday, April 30, 2013
SHANTANU BHADKAMKAR
- ATC
24

25. 4PL & 3PL
OPPORTUNITIES
• Competition, cost worries and strict delivery
schedules are forcing companies to focus on
core competencies & outsource their logistics
Management to third-party vendors.
• About 75% of the companies in the US use 3PL
providers, while India has just made a start

26. OPPORTUNITIES
• GDP Growth ~ 5%
• Logistics Growth Rates Above GDP
• Above Average Market Valuations
• Integration With Supply Chains
• New Models, New Services, Emerging Field
• BRAND INDIA
Tuesday, April 30, 2013SHANTANU BHADKAMKAR - ATC 26

27. Marketing
• More Sales
…
• Sales By
Non Sales
Personnel
• Brand Equity
• Increased
Customer
Focus
Cost Saving
• Discretionary
Expenses
• Greater
Efficiency
• Re-
Engineering
Strategic
Investments
• People -
Talent
Search
• New
Services
• Assets
• Up Value
Chain
Tuesday, April 30, 2013 SHANTANU BHADKAMKAR - ATC 27
READY FOR NEXT UPSWING
… but Competitors are also doing the same

28. CA
Credit
Management
• Bank !
Contracts
Prudence
• Risk Mitigation
• Viability
M & A

29. As Peter Drucker called 3 decades
back is Logistics still the last great
unexplored continent of business?
SHANTANU BHADKAMKAR
Growth – Opportunities - Challenges