In an interaction with Sunil Nair, CEO of Snowman Logistics

The increase in the adoption of technology such as AI, big data, and IoT is improving supply chain transparency and visibility, as well as the overall customer experience, states Sunil Nair, CEO of Snowman Logistics

What is your outlook on the Indian temperature-controlled logistics industry for the coming years?  

The integrated temperature-controlled logistics industry of India has come a long way and still has quite a journey to map. A study by IMARC Group reports that by 2027 the Indian cold chain logistics market is expected to grow at a CAGR of 14.72 per cent and reach Rs 3637.4 billion as compared to 2021 when the market was worth Rs 1585.1 billion.  

The demand for cold chains is also increasing due to the growth in organized retail, processed and frozen foods, pharmaceuticals, and the growing shift toward horticulture, among others. 

A significant increase in the consumption of organic and processed food items in recent years has increased the demand for cold storage the right temperature-controlled environment is extremely important to preserve essential nutrients like proteins in perishable food products, such as fresh dairy products, fruits, and vegetables, meat, eggs, and seafood. Furthermore, the government's supportive policies and plans to develop several mega food parks across India are lucrative attractions for the industry to innovate and expand further. 

The increase in the adoption of technology such as AI, big data, and IoT is further helping improve supply chain transparency and visibility, as well as the overall customer experience. The success of any cold chain is determined mainly by its ability to cater to environmentally sensitive products while maintaining freshness from the point of origin to the point of destination. 

During Q3FY23, Snowman Logistics experienced a YoY increase of 49 per cent in revenue and a 353 per cent surge in net profit. Additionally, your dairy and ice cream segment demonstrated an impressive YoY growth of 151 per cent. What do you attribute to your exceptional financial results?  

Yes, we have got good growth over the last year. This has come primarily due to the growth of volume from Dairy and QSR. We expect the momentum to continue further. Post covid we see these two industries preferring organized partners rather than unorganized ones, due to better quality of service, compliance and contingency planning in place. 

Could you discuss your recent collaboration with BDP UGL Global Logistics and the potential revenue impact it may have?  

We recently opened the first-ever state-of-the-art A-Grade dry warehouse for the chemical industry in Shoolagiri, Tamil Nadu and collaborated with one of the world leaders in automobile chemicals, BDP UGL Global Logistics. This is our first venture into the chemicals business and a step forward in storing and distributing hazardous chemicals. Together we will implement global best practices and develop world-class capabilities for storing and distributing hazardous chemicals in the region and beyond. While BDP will focus on global logistics support to a client, we will manage the storage and transportation within the country. 

After delivering impressive figures for the present quarter, could you provide some insights into your earnings outlook for the forthcoming quarters?  

We have done well this year with a 45 per cent growth in Revenue and a 25 per cent growth in EBITDA. All our efforts are towards maintaining this run rate of growth going forward. With the inclusion of 5PL services and SnowLink (a technology platform to aggregate transport capacities), we see promising growth opportunities. 

What are the three most important strategic priorities for you currently?  

The three main and most important things that we prioritize for this financial year are: 

5PL service 

We are already able to provide additional services to our customers and become an integral part of their organization, which allows us to take on more responsibility at a lower cost. The response to our 5PL solution has been extremely positive. We currently have 3 clients and are on the lookout for more. We are in the process of re-energizing our IT and sourcing procedures to support this initiative. 

Being first of its kind, it is difficult for all types of customers to see the value, but this is only a temporary issue. We are confident that our company has enormous growth potential once the value added to a specific group of customers is demonstrated this year. 

A-Grade Chemical Warehouse  

As previously stated, we have a newly opened A-grade hazardous chemical A-grade dry warehouse in Shoolagiri. This warehouse is Snowman's first venture into the chemicals business and first step into storing and distributing Hazardous chemicals. 

The Shoolagiri facility is 50,000 sq. ft. of warehouse space and a capacity of 5500 MTs with G+5 racking, as well as all necessary safety equipment and compliances. The warehouse is fully equipped with modern storage and handling equipment and offers a safe and efficient storage solution for goods.  

We have stepped outside of our comfort zone this time, despite being a market leader in the cold chain space for over three decades. So, this year, we will focus on serving and growing in this new segment, and we are fully committed to providing the highest quality services in the Chemicals space to our customers. 

Snowlink  

Our technology platform aggregates transport capacities in the country. This has shown a promising growth of 50 per cent from last year. We see this high-potential vertical going forward. Many of the transporters have expressed interest to join us in our initiative of providing end-to-end services to our customers.