—
Dr. Robert Yap, Chairman and CEO, YCH GroupYCH Group, a
leading Singapore based
logistics and
SCM company,
recently opened the
first green warehouse
facility in
India. YCH is bullish
about growth in
India and plans to
invest Rs 500 crore
over the next five
years,
Dr. Robert
Yap tells
Prashant
C. Trikannad.
Can you briefly talk about YCH
Group and its operations in
India since 2006?
YCH operations in India started
in end-2006 in Chennai through
the provision of freight and customs
clearance services to Dell,
and later expanded to facilitate
Dell's finished goods distribution
across India. In 2009, the
YCH SEZ facility in Sriperumbudur
started operations and
ran a VMI (vendor managed
inventory) model, the first of its
kind in India for the electronics
industry, catering to Dell India
manufacturing.
We officially inaugurated our
YCH DistriPark in the Chennai
Special Economic Zone on May 6,
2010, in the presence of Singapore's
Minister for Foreign Affairs,
BG (NS) George Yeo. This
525,000 sq. ft state-of-the-art DistriPark
holds a capacity of more
than 30,000 pallet locations.
Committed to environmental
sustainability and aligned to
international green requirements,
YCH India has been
awarded the Gold Status for
LEED as having the first green
facility in India by IGBC. YCH
India is also certified TAPA 'Aclass'
and is ISO 28000-compliant
for its security systems.
Today, YCH does customs
clearance in six major gateways
(Chennai, Bangalore, Mumbai,
Hyderabad, Kolkata and New
Delhi) and provides customised
supply chain solutions for electronics,
consumer goods, chemicals/
healthcare and automotive
industries in India.
What is your outlook for the
Indian logistics sector in the
next few years? What are the
key elements that will fuel
global interest in the country's
logistics market?
Recent research has shown that
India is being viewed as Asia's
most attractive logistics market,
given its market size and growth
prospects, so growth is definitely
viable. According to a recent study
by Ernst & Young, India's logistics
market is pegged at $40 billion
and is expected to grow at 15-20
per cent over the next five years.
The same report also states
that only 25 per cent of the total
logistics business is outsourced,
while the rest are handled by
companies in-house.
Therefore, as a logistics/supply
chain business, we are certainly
encouraged by these figures and
bullish about growth in India
over the next few years.
As a leading integrated supply
chain management and logistics
company, what are the
potential opportunities for
YCH Group in India?
With Asian markets leading
the emergence from the recovering
global downturn, the tide
has now shifted to our region
with tremendous growth anticipated
to arise in Asia. Thus, we
will continue to focus on the consumption-
driven markets of the
Asian giants i.e. India and
China. This is in line with our
corporate strategy of being an
Asian-focused SCM (supply
chain management) player.
Some of the strategies to
increase our presence in India
include:
- Further strengthening our
position as a VMI (vendor
managed inventory) player in
India, expanding from Sriperumbudur
SEZ to other manufacturing
zones in India.
- Expanding our last mile distribution
business in India with
distribution centres at strategic
locations in India to cater
to the electronics/hi-tech consumer,
chemicals/healthcare
and auto industries.
- Post-GST implementation:
Presently, the supply chain in
India is driven more by tax savings
reasons rather than by
logistics efficiency, driving up
the transport and warehousing
costs. With the introduction of
GST and abolition of CST, trade
boundaries between states will
not exist and companies can
consolidate their supply
chains. It would facilitate
seamless supply across supply
chain and across state. YCH
will set up state-of-the-art
major DistriParks across these
consolidation points and provide
B2B2C services integrated
seamlessly using technology.
How would you compare
logistics in India with logistics
in other countries like,
say, Singapore?
As mentioned, India is being
viewed as Asia's most attractive
logistics market given its market
size and growth prospects. It ranks
at number 4, whereby there is moderate
logistics infrastructure in
place and companies starting to
adopt integrated logistics practices.
It has much more opportunity and
room for growth as compared to an
already developed logistics market
like Singapore, which ranks at 13
(SSKI Research) with an already
developed logistics market. Given
this opportune market, YCH is definitely
excited to further build up its
capabilities to tap on the accelerating
growth of India.
What is the uniqueness of
India's first strategic Green
DistriPark? Do you expect it to
set a trend in this country?
Our DistriPark being the first
green warehouse facility in
India makes it in itself unique as
we are setting the bar for other
companies and the country to
start thinking about green and
sustainable practices. By implementing
such green practices in
water and energy conservation,
we also align ourselves to
requirements of world-class
MNCs to draw them to partner
us and invest in India.
I understand YCH Group is
planning more DistriParks
across India. What does the
expansion plan envisage and
what will be your total investment
in the next few years?
We plan to build more signature
DistriParks across the country in
the next few years to further
complement our extensive network
in India. We have already
invested over Rs 100 crore and
we plan to invest Rs 500 crore
over the next five years.
Dr. Yap, at the official launch of
the first green DistriPark in
Chennai, you said, it "not only
marks an important milestone
in our foray into India, it also
represents our commitment to
boost SCM capabilities." Can
you elaborate?
It has always been our core belief
that nurturing young supply
chain talents is crucial to the betterment
of the industry; and India
is like the young region which is
new to the supply chain industry,
but full of bountiful potential.
Hence, this new facility is not
only a step in the right direction
for our improved operations in
India; it is also an important leap
for SCM in India via SCM knowledge
transference and network
development, contributing to our
overarching vision of building
The Logistics Superhighway.
The YCH SEZ facility in Sriperumbudur
has been awarded the
LEED Gold Status for the first
green facility in India? How critical
is green building and energy
efficiency in logistics?
Just as good logistics and supply
chain is supposed to streamline
manufacturing and
import/export, green and sustainable
practices will streamline
energy and resource usage,
minimising wastage and
increasing the efficiency of what
supplies we have. Our state-ofthe-
art DistriPark gives us 30 per
cent savings in electrical energy
and reduces carbon dioxide
emission by a whopping 440
tonnes per year.
Singapore was India's second
largest investor from 2000 to
2008. What is the nature of
investment by Singapore companies
in India? Do you expect it
to be on the rise in coming years?
With an increase in GDP for
India expected, coupled together
with a growing party of market
savvy Indian consumers,
Singaporean investments in the
country are likely to rise in the
coming years.
What are the recent trends in
global supply chain and logistics,
including third-party
logistics which is gaining
importance in India?
The logistics industry these days
requires service providers to
offer value added services as
many companies are looking for
end-to-end integrated supply
chain providers. Here at YCH,
we offer a 7PL approach, which
combines third party logistics
(3PL) with consulting services
(4PL), aligning us with the
MNCs' needs to have total endto-
end supply chain visibility.
With the Indian market booming
right now, the logistics industry
here definitely has a huge
part to play in transitioning this
market boom to the country's
growth and YCH's strong countrywide
network will unquestionably
prove advantageous for
MNCs who are looking for an
entry point into India