When you are in charge of setting up or organizing your business logistics, there is no such thing as sitting back and relaxing. Your task is to continuously seek improvement and do whatever it takes to facilitate growth that is both robust and sustainable. The world will throw a lot at you and you need to develop systems that can cope. Anything from rising fuel costs through to rising labor costs and even a shortage of raw materials will challenge your profit margins. You need maximum efficiency in your operations to increase your profits.
The efficiency of your logistic operations will impact greatly on how much money you can make and could be the key element of your business that allows you to see off your competitors.
In short, you need a plan! Your ultimate objective is to optimize the logistics operations. Within this, you need to minimize costs whilst fully using your production capacity. The important thing is that the overall customer experience is enhanced at every stage. Make sure that these elements are part of your plan.
Optimize your transportation
Rising transportation costs can seriously damage your business. Use local trucking companies whenever you can who offer freight logistics, competitive rates, and good communication. You are looking for low claims and accessorial charges.
Look at the design of your products and packaging materials. Could you cut costs further by for optimal size and weight? Look into your load and delivery route planning operations. Are the trucks always carrying full loads? If not, this is wasted space that you are paying for. Take some time to investigate the most cost-effective packaging and shipping methods for your particular products.
Revisit your storage options
Sit down and analyze your warehousing procedures. You may find that you can store, move, and ship products more effectively than you are at the moment. You cannot do this alone. You will need well-trained warehouse staff and you need enough of them. Are you making the most of strategic sequencing? This is the practice of only moving products the minimum required number of times. You may also be able to make use of vertical storage to fully ensure that you are fully using the space that you have available. Look at your ordering patterns. Are you ensuring quick delivery of products to every customer?
Could automation help you?
Logistics management software could help you to streamline your operation. Some packages will even communicate with the warehouse and the accounts team so that updates are sent out to your customers, keeping them in the communication loop. Staffing requirements are minimal and so the overall costs are reduced every month. Also, if you own a freight company, chances are your drivers will need an electronic logging device to comply with the ELD mandate.
Keep on looking for improvements
This is a continually evolving situation. Learn from your mistakes by encouraging feedback from your clients and your employees. Logistics management is complex but it is not rocket science! With a cool head and clear strategy, you can make the most of warehousing, transportation staffing, and communication resources to the ultimate benefit of your business.