Logistics management is integral to keeping the supply chain moving. It ensures that your customers’ needs are met and that the business is running as optimally as possible. Most businesses rely on logistics in one way or another, whether bringing supplies in, shipping goods out, or both. Managing logistics involves several processes, some of which can be automated but will still need to be overseen by a person. Read on to learn more.
What Does Logistics Management Entail?
Logistics management, as mentioned above, is an umbrella term covering several different processes. Not every business will need to embrace all of these processes; they might shift a little depending on where on the supply chain you fall. There is:
- Supply management – this refers to the identification, acquisition, and management of external resources and suppliers and encompasses:
- Inbound logistics – the way in which goods come into a business, e.g. orders, incoming deliveries, and storage.
- Product management – this, as the name suggests, simply refers to the act of managing all materials within a business, whether they are raw materials or finished products, and includes:
- Inventory planning – tracking & organizing inventory.
- Warehousing – planning the layout of the warehouse and its organization to ensure all inventories are stored properly and easy to count, track, and access.
- Distribution – this, as a term, refers to the actions taken to move products and goods from your facility to the next facility regardless of whether this is another commercial business of an individual consumer and covers things like:
- Fleet management – overseeing all of your drivers and vehicles throughout the movement of goods.
- Outbound logistics – focuses heavily on the outgoing transportation of goods.
- Customer service – this is significantly influenced by logistics management processes because this dictates the quality of the final products and the way in which they reach consumers and includes:
- Demand planning – a business needs to know what its customers are going to want; this means anticipating needs.
- Delivery fulfillment – the products need to reach the consumers in a timely manner, and you will need proof that the order has been fulfilled, sent out, and received.
- Returns management – not every product or good is going to be satisfactory to the customer, and sometimes this is out of your control, regardless anything that gets sent back needs to be accounted for and dealt with.
Each of these elements is a cog in the machine, and in order to ensure a business runs smoothly, all of them need to be optimized for efficiency.
The Importance of Logistics Management
Having better logistics management strategies is important; it helps ensure that the business is running as smoothly as possible, which is why it should be built into the business framework. Developing effective management processes allows a business to operate efficiently, which often speeds things up, allowing consumers to receive products more quickly, and improving customer satisfaction and retention, which translates into more sales.
More sales mean more profits, but not only but profits are also maximized by efficient processes which increase the fulfillment rate and help to reduce wastage. Effective logistics management means coming up with the best practices, finding suppliers, and looking for other ways to reduce costs or divert funds as necessary.
How to Improve Logistics Management
By now, the importance of logistics management should be clear, so if your processes are lacking, you really need to look for ways to improve. Luckily, you can improve your processes pretty easily. You should start by being aware of the risks to your business in terms of logistics and how you can develop strategies to safeguard against them. This is likely to include waste management, theft, and damage.
Embrace technology where possible; it can help streamline your business’s logistics management approach. Automation isn’t always the answer, but it is definitely worth considering. There are so many tools at your disposal when it comes to logistics management. Digital processes can help; think about implementing software that both you and your consumers can use to make orders and adjust delivery information. It also makes sense to install tachographs on vehicles in order to track them. Businesses like FleetGO can help and have remote tachograph download features too.
Within the same vein, it also makes sense to look into contactless payment options. It helps to free up employees, and customers appreciate the convenience afforded. Convenience is key. It can really become a selling point for your business. But, more than this, it should also be a consideration in your business practices. For example, as your business grows, you’ll need more storage facilities, so why not consider locations close to central delivery areas? Most businesses will look for storage solutions near their central hub, and if this makes sense, go for it. If not, why not think about important consumers or areas with high demand and set up secondary hubs near them to cut delivery times?
All businesses rely on logistics management in one way or another, which is why it is so important that you do everything you can to improve these processes and maximize efficiency. Truthfully, it might seem overwhelming when you think about everything that logistics encompasses, but it is all things that your business will have been doing anyway. Improving your approach is also easier than you might expect – if you take on board the above tips.