Supply chain firm Prozo is focusing on expanding its warehousing footprint drastically in India. The company has announced plans to add 5 million sq ft of warehousing space within three years, up from the current 1.5 million sq ft. The warehousing expansion will particularly cater to brand demands for fulfillment centers to address multichannel demand, reveals Ashvini Jakhar, Founder and CEO of the company.
“We will have 70-100 warehouses, depending on which sizes we go ahead with and how the demand pans out. We have developed that expertise and set up close to 25 warehouses in the last 11 to 12 months,” Jakhar said.
Investors such as Sixth Sense Ventures, JAFCO Asia, among others are backing the expansion plan with a funding of Rs.131Cr.
It is expected to invest Rs 50 crore every year to expand the warehousing presence.
“Brands are going through a very unique situation right now, as the demand side is fragmenting quite a bit. Multiple channels of demand have opened up and every brand has to serve demand from all of these channels. Brands are now facing a tenfold increase in complexity as the number of channels has multiplied from three to thirty, even though the demand has only risen by 10 or 20% for every one rupee,” said Jakhar.
“Now that is putting a lot of pressure on the supply chain. Cost of customer acquisition is increasing for brands and margins are shrinking. We are building an operating system of supply chain that helps brands address each of these key challenges and pain points,” he added.
Prozo, with its extensive network of over 30 multi-channel warehouses spanning across India, along with a logistics network covering 20,000 pin codes, is strategically preparing for a substantial series B funding round in the fiscal year 2023-2024.
The company’s primary focus will be on tier 2 cities, recognising the significant shift in demand towards those regions.
Prozo is currently managing supply chains for over 100 companies including Reliance JioMart, Urban Ladder, MPL, Hyundai, Butterfly Appliances, McGraw Hill, Wonderchef, LEAP, Treebo, Tata Consumer Services, Aditya Birla Group, Snapdeal, Fancode across 12 locations.
