Logistics is a major element needed to have a successful supply chain, it is responsible for monitoring inventory levels, improving productivity, reducing costs and directly affecting a business’s profitability. We will take an in-depth look at the different aspects of the logistics industry to better understand the role logistics plays in a successful business and how each aspect can benefit a business’s profitability.
The 5 main aspects of the Logistics Industry
The 5 main aspects include planning, warehousing or storage and materials handling, project management, inventory management as well as transportation management.
Arguably the most important part of Logistics is planning, planning involves the management and organization of the entire logistics process. From the time the order comes in and monitor it until its completion. The planning team is responsible for ordering the inventory from the supplier (at the right price and within the requested time frame), then determining how the inventory will reach the warehouse, how it will be stored and packed in the warehouse and selecting the best method of transportation of the inventory on delivery day. All while constantly gathering information on various outside elements such as weather or demand to predict how long the inventory will take to be delivered and use all of this information to satisfy the customer.
Transportation involves determining how the inventory will be delivered from the supplier to the warehouse (if storage is needed) and then onwards to the customer or straight to them depending on the situation. The transportation team is responsible for selecting the quickest and most reliable form of transport for your goods while ensuring that it matches your budget and time frame. They determine whether your inventory needs to be transported via truck, airplane, ship, or a combination of all three. Smaller packages may be combined to save costs, this is commonly called consolidation. The transportation team is also responsible for determining if consolidation is possible.
Warehousing or Storage Facilities
When goods cannot be delivered directly from the supplier to the purchaser then they need to go to a warehouse or storage facility. This is when the warehousing team is contacted and needs to take part in your logistical needs. They are responsible for determining the best warehouse location to store your goods to save on transportation costs, how your goods need to be stored, for example, if they need to be frozen, for how long they need to be stored and whether there are any other packages that they can be transported with to save costs. A good logistics company will always try to save their client costs while offering them the best service possible. Many warehouses have a warehouse management system they utilize which helps them effectively manage the storage, care, retrieval, packaging and placement of all the inventory in their warehouse.
Many businesses entrust logistic companies with the task of monitoring their inventory levels. Instead of having their inventory control system, they utilize the logistic companies’ warehouse management system to monitor their inventory. This is another service logistics companies offer their customers, this team is dedicated to monitoring the inventory levels of all of their clients and notifying them when stock is low and ordering more stock on their behalf so that the client never runs out. The inventory management team constantly monitors supply and demand information to successfully handle their clients’ inventory levels. Some of the main benefits of inventory management include accurate order fulfillment, saving time and money, increased productivity and customer satisfaction as well as forming better relationships with their suppliers.
As you can see there are many different teams and individuals involved in the logistics process. One team is dedicated to managing all the teams and ensuring they are working together efficiently. The project management team is a vital part of any logistics company as they ensure all customers’ needs are fully taken care of and monitor the flow of communication between the various departments. Larger companies, with enormous amounts of inventory being transported by one logistics company, can request their project manager, which is dedicated solely to their needs and expectations.
And those are the 5 main aspects of the Logistics Industry. In our next article we will be discussing the main functions of the Logistics Industry, so stay tuned into our social media accounts @bridgewaterlogistics or visit our website for more information: https://bridgewaterlogistics.