Material Handling - A Crucial Intermediary in Manufacturing Sector

Industry Outlook Team

The material handling equipment market size is anticipated to reach USD 348.6 billion by 2026, expanding at a Compound Annual Growth Rate (CAGR) of 5.2 percent during the forecast period. Factors fueling the growth of this sector include the increase in demand for incorporation of automation and modernization in manufacturing processes, expansion in the aviation industry and e-commerce industry, and demand for transparency in the supply chain process and flexibility in warehouse operations.

Material handling equipment is most commonly used in warehouses. They are used to manage the storage and transportation of raw materials, finished products, and other goods. Material handling is a crucial intermediary in the manufacturing sector as the usage of material handling equipment helps in improving productivity by enhancing logistics at warehouses and manufacturing plants.

Although it does not directly contribute to the production of goods, these material handling products not only help in efficient handling, managing, storing of consignments but they also provide cost-effective, process efficiency, and an accurate method for the swift transition of goods across the manufacturing plants and warehouses, leading to rising demand.

Safer handling practices in warehousing operations

Despite the current slowdown in the material handling equipment market owing to the COVID-19 pandemic, this market is predicted to rebound soon with various new practices of safer handling in warehousing operations.

For the past few years, the growing organized retail market and the post-GST realignment in logistics operations are pushing the growth of warehousing operations in the country. Simultaneously, more battery-operated and environmentally friendly handling equipment is being introduced in the essential services segments such as the pharma industry.

Moreover, growth in industrial manufacturing and the setting up of more and more manufacturing facilities has also resulted in the introduction of a variety of new handling solutions. According to Sunil K Gupta, President, KION India, “Palletization of goods has been focused upon by major medium and large organizations”. He adds, “Big brands have invested in large warehouse spaces to meet the demand which we forecasted for this year in retail. However, the small industries have started identifying the benefits and started to use smaller equipment.”

The development of new warehouses and modernization of existing warehouses have observed the transformation of products and technologies in handling equipment. Furthermore, handling of pharma products will need environmental-friendly equipment such as battery-operated forklifts for lift trucks.

Based on the product type, the material handling equipment product segment has been classified into various equipment such as storage and handling equipment, automated storage and retrieval system, industrial trucks, bulk material handling equipment, and many others. Among these, due to the increasing adoption of robotic systems, conveyor systems, and AGVs in the warehouses and manufacturing plants, the automated storage and retrieval system is expected to grow at a Compound Annual Growth Rate (CAGR) of 5.0 percent during the forecast period.