COVID will lead to increase in mechanisation of material handling: Anil Lingayat
In this interview with Rakesh Rao, Anil Lingayat, Executive VP & Business Head of Godrej Material Handling explains how warehouse operations are growing in scale and complexity resulting in the need of modern MHE technologies.
Material handling equipment (MHE)
play critical role in any manufacturing units and warehouses as they ensure smooth and efficient transfer of materials within the premises. While COVID has slowed down the pace of economy, industrial activities are likely to pick up in coming months amid restricted human involvement at the workplace. Competitive pressure and the need to save time and improve productivity will make MHE necessary for almost all manufacturing and logistics operations, says Anil Lingayat, Executive Vice President & Business Head of Godrej Material Handling
- a part of Godrej & Boyce Manufacturing
Co Ltd and one of the leading players in material handling equipment industry in India. According to him, India’s material handling equipment industry is moving towards a cleaner, more productive, safer and digitally enabled future. In this interview with Rakesh Rao, Anil Lingayat explains how warehouse operations are growing in scale and complexity resulting in the need of modern MHE technologies.
Which industries are driving the growth for Godrej Material Handling?
Godrej forklifts are used in almost every industry that needs to move heavy items from point A to B. Barring IT, banking, education and such services, the forklift truck is ubiquitous in almost every manufacturing and logistics related industry. From core industries like mining and metals, to infrastructure industries like building & construction, ports, railways, air transport, and to companies in manufacturing, retail distribution and e-commerce, all use forklift trucks at various points in their supply chains.
In exports, Godrej Material Handling has been strategically focused on select markets in the Middle East, Africa, SAARC and ASEAN regions. Our industry focus in these markets is mainly on food & beverage, FMCG, apparel, pharma industries and warehouse operators.
In April this year, Godrej Material Handling launched Bravo electric 3-wheel forklift. What is the significance of this launch for the company?
Warehouse operators need fast, stable forklifts to zip around the confined spaces in a warehouse. This is where the 3-wheel electric forklift pips the larger 4-wheel models. Hitherto all 3-wheel forklifts were imported. The Godrej Bravo 3-wheel electric forklift with capacities of 1.6, 1.8 and 2 tonne is the first indigenously developed and produced model in this range. Each front wheel has its own drive motor and gearbox and that gives the truck power and a top speed of 15 kmph. Its compact build gives it a turn radius that is 25 per cent less than its 4-wheel cousins.
Godrej has packed this machine with features to guarantee high performance and safety. Totally enclosed and sealed wet disc brakes ensure rapid stopping and a service interval of 6000 hours. Smart Curve technology detects turns and reduces speed by up to 25 per cent to ensure the truck remains stable at all times. The frame is designed with a low centre of gravity enabling the forklift to safely lift loads as high as 6 meters. The LCD display keeps the operator informed about all vital parameters like speed, wheel position, battery charge and also provides fault alerts.
The Bravo 3-wheel electric forklift is designed to contribute to greater efficiencies in warehouse operations. We expect this truck to be a great choice for all warehouse operators in retail, e-Commerce and logistics. It will also greatly benefit manufacturing companies who need compact forklifts to navigate narrow aisles on their shop floor.
How has been the response for Godrej RenTRUST, the new equipment rental brand launched in July last year?
The response to RenTRUST has been great! We have expanded our fleet to over 700 equipment and stand amongst the three largest operators in India. Our rental sites are across 21 states. The pandemic and consequent lockdown was a testing time and we are proud to say that kept over 100 customer sites operational, fully leveraging our in-house digital platform to manage the rental business. We expect the current volatility to spur demand for rental as users try to minimize capital expenses but need to match fleet size to changes in demand. Customers are also showing a preference for larger, organised rental service providers with a promise of regulatory compliance. They also expect rental equipment providers to ensure safety and well-being of their own and customer’s employees during the current times. And of course, IoT driven analytics to optimise fleet size and deployment.
Will COVID 19 bring in revolutionary changes in MHE industry?
In a word, yes. One of the major effects was the shift to online buying. While this has peaked and some of it may move back to off-line purchasing, e-Commerce should see a new, higher level of consumer demand in the future.
Most industries are affected by a shortage of labour shortage brought about by the pandemic and now almost all are concerned about how to maintain social distancing at the workplace. Together, these will drive the adoption of mechanized handling in various forms.
Many companies are seeing volatility and uncertainty in demand and most feel a liquidity crunch. To meet surges, they would opt for rental equipment in the short-term because the payback cycle for investing in new equipment could be delayed. It is also difficult to shell out a large sum at one go to purchase capital equipment. This will drive the rentals business across the industry.
While digital meeting tools have become very common, we see this percolating even to the area of servicing industrial equipment. Customers are showing a preference for remote assistance over video to resolve simpler maintenance issues of their forklifts in order to avoid external personnel visits in their premises. Godrej Material Handling was a step ahead, by launching our product manuals on a digital platform which both our channel partners and customers can easily access. Thanks to this, we were able to provide effective remote assistance to dozens of customers during the lockdown.
Many of these new measures and ways of doing business will be retained post the pandemic and may require us to modify the current way of working, at least for the foreseeable future.
Do you see a rise in demand for automated material handling equipment post COVID with social distancing norm becoming a new normal?
We believe India will have to find its own path in the area of handling automation rather than adopting what Europe or the US have done. Our country is currently an underserved market for material handling equipment. Labour costs are still low, palletization is sparse and not uniform. There is room for manufacturing and organized logistics to grow. We are probably in the early stages of huge growth in material handling.
While a case may be made for India leapfrogging from manual handling to automation, there are several factors to be considered, like the high initial investment required for automation, high cost of capital, the high and (more importantly) steady flow of goods through the warehouse or factory, standardization of SKUs, the requisite level of demand to justify automated handling, etc. These financial and business conditions are likely to slow down the pace of automation.
Automating material handling also often requires a change in mindset and re-engineering of the shop floor or warehouse, re-engineered processes, re-training of people, etc and then sustaining this into the future. The other drawback is that one cannot down-scale. Once an automated facility is set up, the costs are incurred and the infrastructure is permanent, regardless of whether the business grows or not. A business using forklift trucks, on the other hand, may be able to dispose of excess equipment or take on additional forklifts on rent as required.
Automation is also of various types starting from driver assist systems that step in to automatically slow down a forklift in the vicinity of people or other equipment, safety warning systems if the driver performs an unsafe operation, etc. and can be as sophisticated as a driverless forklift or an AGV. A still higher level is a complete Automated Storage and Retrieval System (AS/RS). E-commerce companies often deploy Automated Mobile Robots (AMRs) that bring racks of goods to the person picking an order rather than having the picker move around all over the warehouse.
Indian buyers are also very astute and will not invest in new technology unless there is a solid business case for it. So, forklift trucks, reach trucks, stackers and pallet trucks are here to stay for years to come while we can anticipate seeing automation in different forms also being deployed gradually in material handling.
What are some of the emerging trends in material handling equipment sector?
Currently, emerging trends are mainly in the area of electric battery powered equipment to respond to user needs like enabling the forklift to run longer hours on a single battery charge, or enabling users to charge batteries at a convenient time rather than when the battery needs to be charged.
As warehouse operations are growing in scale and complexity, emerging technologies like warehouse trucks for specific tasks, fork trucks integrating with warehouse management systems, etc are catching on.
IoT is fast emerging as a useful tool to monitor fleet health, provide proactive or predictive maintenance and optimise fleet size.
Increased measures in safety and productivity is another trend. While forklifts are a necessary and vital part of any material handling operation, they also present a risk in an environment with people and other handling equipment moving around.
The last trend is digitization. The new generation of managers and even forklift operators are more comfortable working with digital manuals, digital training programs and communication platforms. Even transactions are moving online.
All these trends are moving India’s material handling equipment industry towards a cleaner, more productive, safer and digitally enabled future.
How is Godrej Material Handling tapping trends like electrification and connected vehicles?
Godrej has been leading development in the electric battery-operated arena for over a decade. We were first to introduce AC technology about 12 years ago. In 2014, Godrej launched India’s first 5 tonne electric forklift. Current developments in this area are the Bravo 3-wheel series. For example, the Bravo 3-wheel electric forklift - which was launched in April 2020 - is packed with features to guarantee high performance and safety for greatly improving efficiencies in warehouse operations.
On the battery front, we recently introduced Li-ion batteries. These enable users to quickly charge the battery whenever the forklift is not in use. Even as little as a 15-minute charge provides an hour of operation time. For those who prefer lead acid batteries, we offer smart chargers to charge batteries more quickly, while consuming less power.
IoT is a recent development and while we fit sensors and telemetry devices on our rental fleet equipment, a portfolio of services based on IoT is under development.
There are ways to enhance the safety and productivity of forklifts and Godrej has always focused its energies there. Our new models work faster, moving more pallets per hour than before, built-in safety features and diagnostics ensure high uptime, and a host of safety accessories like proximity warning lights, buzzer alarms, electrically interlocked seats, access control, auto slowing around corners, cameras, etc. enhance safety of operations.
Godrej have digitized its service and spare parts manuals. We also provide remote assistance to customers and online training. The next phase will be to move to proactive and predictive maintenance.
In the area of warehouse trucks, our portfolio development continues at a pace, extending lifting capacities and reaching higher racking levels than ever before.
Experts anticipate more manufacturing to shift from China to India. How hopeful are you on this?
The MHE industry in any country is connected to the size of its manufacturing sector and to organised storage and distribution. So as global companies evaluate India as a potential destination for manufacturing operations and move here, India will certainly see growth in material handling also. The Indian government is also leading various initiatives to create an opportunity here for global manufacturers. A second means to boost India’s MHE industry will emerge from the material handling practices such companies will deploy in their factories and in their supply chains. India will naturally face competition from other nations vying for this opportunity, but we are sure to gain.
What is the outlook for the material handling equipment industry in India?
It’s almost a no-brainer that the MHE industry in India has a bright future and will grow. Urbanisation, youthful population, rising aspirations, higher incomes, contribute to domestic consumption in any economy. The government also has programs to drive local manufacturing and develop infrastructure. All of this will drive the growth of manufacturing and logistics. Rapidly rising industries like organized logistics, retail and e-commerce are all about storage, handling and distribution. The rising level of economic activity will drive the need for moving materials and there is only so much that one can achieve with manual labour. Competitive pressure and the need to save time and improve productivity will make MHE necessary for almost all manufacturing and logistics operations.
There will, of course, be ups and downs along the way, like the economic slowdown in the second half of 2019 and 2020 has been a kind of landmark year with the Covid-19 pandemic. But the world, and India in particular, will move beyond this and the economic engine will crank up again. The long-term story for India and its material handling equipment industry is intact and strong.
What are your growth plans for Godrej Material Handling?
A steady stream of new products, technologies and services for our customers has kept us ahead over the past few decades. Our wide range of service offerings ranging from annual service contracts to complete operations and maintenance contracts and rental are an important facet of our growth plans. We continue to make significant investments in our manufacturing facility for capability and capacity building.