A Logistics professional is extremely important in companies. It could increase efficiencies, lower costs, higher the production rate, better the inventory control, smarter use of warehouse space, increase customer and supplier satisfaction, and improve the customer experience of those buying. Here a few problems that the logistics may have and a few solutions as well:
What are the Logistics Problems?
- Reducing Transportation Costs
This is the biggest challenge that the industry faces so far since transportation takes up about 30% of the total expenses. With the fuel prices rising, this can go up to 50%. Problems in these may include reducing carriers, consolidating shipments, and reducing fuel expenses.
- Enhancing Customer Service
Marketings are dynamic, supply chains that have become longer and more complex, and these days, the customers’ expectations have also changed in terms of delivery times and service quality.
Logistics partners must recruit the right people with the right skills and attitude because of this, so they could enhance the customer’s experience across all geographies, channels, and touch-points.
- Improving Business Processes
The logistics business is highly competitive, which is why the industry benchmarking plays a huge role in business process improvements. The logistics partners are expected to have the knowledge and a ton of experience to look beyond supply chains and logistic operations. They also need financial stability, flexibility and are open to taking reasonable risks long term.
- Supply Chain Finance
The access to the supply chain finance is critical for shippers and logistic companies to ensure smooth business operations and optimization of cash flow. Finance is typically required for letters of credit, open accounts, freight audit payments, and the like, so the companies need to constantly update that.
- Improving Supply Chain Visibility
This is needed in order to have accurate, on-time deliveries, logistics need to have full visibility on all aspects of the supply chain. The shipments must be tracked and notified so the prompt can be taken. Customers need to be updated.
- Driver Shortage
Truck drivers have a very difficult and demanding job, especially with the increase in government regulations. There has been a constant driver shortage because there is a lot of paperwork and rules that come along with it.
- Impact of the Economy
Logistics can really impact the economy, like political instability, the decline in manufacturing sector performance, increase in the consumer price index, inflation, and the like so government investments in infrastructure projects increase wages and demand for products.
- Technology Advancements
With technology constantly evolving, adapting new and innovative technology solutions has become imperative for logistics companies. Competition is intense and customers have become more demanding, technology advances increase productivity by minimizing time so companies need to constantly evolve their technologies as well.
Companies comply by adopting route and load optimization, tracking and reporting emissions, upgrading engines, and choosing alternative fuels.
- Government Regulations
Governments have tremendous power in global shipments even after the shipment clears the ports, the government needs to give their approval. Zoning permit laws and taxations also impacted logistics.
How do you simplify logistics?
- Supply Chain Segmentation
- New Products
- Outsource Modular Product Manufacturing
- New location or Channels
- Ecommerce Can Deliver Global Reach
How do you handle logistics
- Take the time to make a solid plan
Effective logistics is all in the planning so the fewer decisions that need to be made the better. You need to have a solid plan because a good logistics manager will make sure to plan well ahead so that they can eliminate any delays in the supply chain as best that they can.
- Always have a contingency plan
No matter how solid you think your plan is, you should always have a second plan. It is better to be prepared than to be left in the air.
- Hire a logistics manager with strong interpersonal skills
If your logistics manager is good with people and they have a solid network of industry contacts, he could possibly get you out of logistics problems that you may or may not face.
- Automate your systems wherever you can
There are a number of ways for you to automate the logistics process in the digital age so you could ensure your business by using fleet and inventory management software that will allow you to refine your processes around.
- Learn from your mistakes
It all depends on the size of your company, but poor logistics management can cost your company hundreds and thousands of dollars each year. You should regularly sit them down as a team and discuss ways for you to make sure that mistakes don’t happen once again.
Logistics in the companies are incredibly important. Are you looking for a company to handle your logistics? Sure Logix are teams of logistics professionals who can help you with your logistics needs.