Ecommerce News

Indospace: Steep dip in e-commerce warehousing demand as inflation hit consumption: Everstone’s Rajesh Jaggi


Rajesh Jaggi, vice-chairman, Everstone Group; Illustration by Manali Ghosh.

Synopsis

Slowing demand from e-commerce is a worrying sign for modern warehousing, which counts online players as its major occupants besides third-party logistics (3PL), retail, and FMCG companies. E-commerce firms contributed a puny 4% to total warehousing leasing in the first half of 2022, down from 23% in the first half of last year, according to data from property-consultancy firm Colliers. What’s adding to the owes is the rising cost of major inputs like land and steel. Clearly, the operating environment for warehousing players is getting tougher. Rajesh Jaggi, vice-chairman of Everstone Group, which backs the country’s largest Grade A warehousing player Indospace, shares his insights with ET Prime.

What does the current environment look like for warehousing players?In the last 12 months, there is a demand-supply slowdown across the world and in India. The business that we are in is getting tougher because of increasing land and raw-material costs. However, a good sign is that rentals in some markets have adjusted forcefully because of the increase in inflation. What we are trying to see is whether we can opt for alternative and cheaper

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