Logistics is the methods used to get the right product to the right location, at the right time. Defining how goods and services move along the supply chain is crucial to company success. They can move from factory to customer, or supplier to factory. There are clear steps to be taken that integrate key decisions, processes, and strategies. Your answers will prepare you for efficient inventory management, distribution, and delivery.
To manage your supply chain, ask these questions.
- Does your company produce its own products, or buy them?
- What kind of transportation is used?
- Where are your company’s warehouses?
- How does your inventory management system work?
- What information systems does your company use?
Order Fulfillment
The supply chain starts moving when an order is received. In a perfect world, the first step is to prepare a work order and invoice, and to then check inventory. Once inventory is confirmed, approval is sent to the client and shipping labels and documents are prepared. The shipment is packed, the freight company picks it up, and your customer receives the correct order within the specified time frame.
Since there are various departments involved in logistics from start to finish, errors can occur. These areas can include accounting, finance, production, transport, and warehouse. Planning ahead for possible roadblocks with any department is important.
- Understanding product demands and trends help maintain correct inventory levels. Order what you need and plan ahead to keep costs down. If using vendors, understand their processes; if items arrive to you late, it could lead to one of those nightmares we spoke of earlier.
- Perfect a business strategy that will meet your customer’s needs, demands and expectations.
- Research the transportation process: look for the most efficient systems, and have backup suppliers in place. Bad weather and other factors can halt deliveries.
- Invest in top-level customer service. Keeping those customers satisfied will lead to additional orders.
Managing Orders & Performance
Achieving logistics perfection – or close to it – takes work. Use metrics to measure your supply chain’s performance, reliability, and accuracy. Products should be manufactured within specifications, carefully packed, and correctly delivered. Track the delivery cycle timing and look for improvements. Monitor all costs to see if they can be streamlined.
Preventing Logistical Nightmares
We have all heard stories about companies not getting their products to their consumers on time, sending inventory to the wrong location, and the like. As evolving technologies like drone delivery and SmartApp ordering expands, understanding the basics will help you avoid those bumps in the road (or in the skies?).
Choosing the Right Logistics Company
Finding the right supply chain balance between all the departments requires constant evaluation and performance measurement. If your company does not have a system in place for this, it is time to get one.
Working with these departments to improve your company’s product delivery logistics can lead to highly effective supply chains. This is also a good time to rethink your marketing strategies; for example, better package design may allow your company to fit more products into that tractor trailer. Sales and promotions can also funnel more products and services into your supply chain. Hiring marketing professionals will help you stay on top of your company’s logistics, and will take your supply chain to the next level.