Big DataCorner OfficeExpert Opinion

Future of the Cold Chain Industry in a Post-Pandemic World

Cold Chain

The early days of the pandemic hardly require a refresher. The chaos, the panic buying, the uncertainty; the world was hit quite hard with the harsh reality of dealing with an unforeseen challenge and the cold chain sector was no exception. There was a sudden influx of demand for cold chain services, and initially, it was a tough bridge to cross. The industry was faced with a shortage of storage units, and given the nature of the crisis, they also had to account for shortage of labor. Handling such circumstances in the past year has been a learning experience for the industry in more ways than one.

To put things into perspective, let’s take a look at the key takeaways of the pandemic and the path that it has laid out for the future of the cold chain industry.

Collaboration within the industry:

The manufacturing and transportation segments of the cold chain industry are functionally interdependent. Manufacturers, be it local farmers, fishermen, vaccine and medicinal drugs manufacturers, rely on transporters to ensure that their products reach a large majority of the country. At present, the collaboration between the two segments is fragmented, making the availability of cold chain products sparse.

Bridging this gap calls for the industry to establish a centralized and interconnected cold chain network. This network has to be accessible to transporters ranging from tier 1 to tier 3 cities and the remote areas of India. It is crucial that the industry, given the circumstances, focuses its efforts towards supporting the upcoming local logistics entities by helping them meet GDP compliance and getting them up to speed with technological advancements. This intervention will allow small scale transporters to amp up their functions on a national level. Recognizing the pivotal role of small-scale transporters will be the roadmap to mobilizing cold chain products all over the nation.

While an integrated network will solve a lot of the functional concerns of the industry, the cold chain network will also have to address the subject on a technical level. Transportation Management System (TMS) and Warehouse Management System (WMS) operate independently in most cold chain operations, and this has emerged as an obstacle when consolidating temperature related data and keeping track of the shipments on the road.

Achieving this will require a well-tethered WMS and TMS that provides and stores information about the shipments from storage to transport. A grouped operation system will help seamlessly gather details about manufacturing, storage, the journey, product status and distribution all in one place; enabling the industry to keep track of the progress made and assess any mishaps, should they occur.

While a unified cold chain network will amplify the existing cold chain architecture, broadening it with ample technological equipment is an inevitable step forward for the cold chain industry.

Maintaining the momentum:

The surge in the need for cold chain services in the past year made the industry function on a scale larger than ever before. This accelerated need also amplified the scant supply of cold chain equipment (CCEs) like cold storage units, walk-in coolers and freezers, solar direct drives, vaccine carriers, voltage stabilizers, and others.

Making CCEs readily available regardless of where in the country the demand stems from is a goal that the industry will have to work towards. The increased support from the government and private investors in the past year, has made the objective more attainable. Government initiatives like Scheme for Cold Chain & Value Addition Infrastructure, Pradhan Mantri Kisan Sampada Yojana (PMKSY) and Backward & Forward Linkages have aided upcoming cold chain entities and championed the needs of the existing establishments.

With more startups and existing businesses venturing into the industry, the market dynamics of the cold chain sector has changed, triggering an increase in investments. This trend is likely to continue in the coming years as the industry will continue to grow exponentially. The investments will help the industry expand and flourish into prominence, while also opening up avenues for the country’s economy to thrive.

The road ahead:

As challenging as it was, the pandemic has doubled the growth rate of the cold chain sector, and it has pushed the industry onto the track of advancement and progression. With the right collaborative approaches, upgrading to the latest available cold chain technologies, and with more startups trickling into the sector, the industry can contribute immensely to the country’s economy while also fulfilling the cold chain needs of the country.

At this growth rate, the industry could also look to venture into international exports and imports in the future, forming a cold chain network that has a reach across the globe. This could potentially make India a prominent international cold chain giant.

(The author is Co-Founder and COO, Celcius and the views expressed in this article are his own)

Leave a Response