The Indian supply chain company Prozo is planning to add up to 5 million square feet to its warehousing space by 2026, up from 1.5 million square feet currently, at a cost of around Rs 50 crore ($6.11 million) annually over the next three years, according to The Economic Times of India.

The plan aims to establish between 70 and 100 warehouses in Tier-II Indian cities — places that have fast-growing real estate markets, steadily increasing investment rates and populations ranging from 50,000 to 99,999 people — adding to the 25 facilities Prozo has built over the last 11 to 12 months.

Prozo CEO Ashvini Jakhar said the expansion comes as a response to growing demands for fulfillment centers that are able to address organizations’ multichannel needs.

“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,” Jakhar said. “Brands are now facing a ten-fold increase in complexity as the number of channels has multiplied from three to 30, even though the demand has only risen by 10% or 20% for every one rupee. Now, that is putting a lot of pressure on the supply chain. The cost of customer acquisition is increasing for brands, and margins are shrinking. We are building an operating system of supply chains that helps brands address each of these key challenges and pain points.”

Prozo currently manages supply chains for over 100 businesses, including big-name companies such as Hyundai, McGraw Hill and Tata Consumer Services.