FM Logistic to set up intra-city warehouses in Mumbai, Delhi, Bengaluru

December 17, 2020: The Pune-based FM Logistic India is looking to set up intra-city warehousing units across Mumbai, Delhi and Bengaluru, including by converting some abandoned mills into such facilities, amid increasing demand for quick deliveries by online customers.

“The company is in discussion with a closed mill owner in Mumbai, while exploring the possibility of such projects in Delhi and Bengaluru. However, along with this, FM Logistic is also open to set up completely new intra-city warehousing facilities as well, says Alexandre Amine Soufiani, managing director, FM Logistic India.

The French 3PL (third-party logistics) player made a foray into the domestic market after acquiring Pune-based warehousing firm Spear Logistics in 2016.

FM Logistic India has presence in over 90 locations, and it provides warehousing and distribution logistics services for the FMCG, retail, automotive, e-commerce, engineering, telecom, pharma and other sectors.

The company reported over 15 percent growth in revenue in the financial year 2019-20, despite slowdown in the automotive sector as well as economy in general. Last year, the company announced setting up of a 31-acre multi-client logistics facility at Jhajjar in Haryana at an investment of $30 million.

This project is part of the company's plans to invest $150 million over the next five years in setting up warehouses in India, announced in March last year.

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“In the post-Covid-19 scenario, having an intra-city warehousing facility is a must to be able to deliver the goods to the end-customer within hours of placement of an order. But, the land in the cities is costly, Soufiani said.

"We are scouting for warehousing facilities inside the cities of Mumbai and Delhi to either build new multi-story warehouses, which are a new concept or to refurbish abandoned cotton mills in Mumbai within the city," he added.

He said he has to partner with e-commerce and other omnichannel retail companies and offer them multi-customer facilities with intra-city warehouses.

Soufiani said Mumbai has many closed mills and the company was thinking of partnering with owners of those mills and transforming them into intra-city warehousing.

"In Mumbai, we are in talks with one of the mill owners, we are carrying out due diligence and looking at how we can make it safety-compliant, as we do not want to compromise on the safety aspects at all," he said.

Soufiani said there are two models, one is to take on lease a closed mill land or a sick factory unit, refurbish them with all safety measures like fire alarms and proper exit gates and use them as intra-city warehouse. The second model is to build from scratch vertically instead of horizontally to deal with the issue of land, which is both scarce and expensive.

"Besides requiring lesser land, a vertical warehousing facility for lesser gives the possibility of separation between the different customers and also has the advantage for the cold storage for pharma," he added.