IndiaRetailBiz

Thanks to booming economy and booming retail sector, third party logistics (3PL), is also booming. The pace of the sector is bound to receive further boost after Goods & Services Tax (G&ST) regime is introduced across the country. This will allow for free movement of goods from one place to another based economical consideration rather than artificial political and legal restrictions.

3PL companies provide multiple logistics services for its clients and customers. According to a 2007 study of the sector, most frequently outsourced services include domestic (83%) and international (79%) transportation, warehousing (69%), customs clearance and brokerage (67%), and forwarding (51%).

In India 3PL sector is currently valued at $100 billion and is expected to to touch $150 billion by 2010.

No wonder than that business conglomerates like Reliance have begun eyeing the sector and begun looking at growing through acquisitions.

Reliance Logistics Limited (RLL), a part of Mukesh Ambani-led Reliance Industries, which provides transportation, distribution, warehousing, logistics, and supply chain services, mostly to its parent company, according to a DNA report, is looking at expansion through acquisition of mid-sized 3PL companies.

Reliance Retail, which is one of the fastest growing retailers in the country, is gong to remain one of its major customers. Moreover, the logistics company is also looking at increasing its share from non-group customers, who  currently account for one-fourth of its turnover.

“RLL is looking at acquiring mid-sized companies with turnovers of Rs 100-1,000 crore and operating in the 3PL field,” said a source close to the development.