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Nowadays, logistics chains are much more confusing than a journey from point A to point B. More than one carrier and the company selling the goods can be involved in just one shipment, and more than two communicating managers in the whole supply chain – not to mention the number of loading/unloading points, the transmission of information to interested parties, and all accompanying documents before and after the sale. Most manufacturing and trading companies are well placed to accomplish every logistics “mission” from start to finish and aim to do so in the fastest and cheapest way possible. But the question is, are the most appropriate logistics tools always chosen?

1. Communication between internal departments

An essential first step in streamlining the logistics chain is smooth communication between sales and production. Companies incur the most significant losses when they “sell” to the customer what they cannot deliver (overtime, urgent and inflated price transportation, penalties for downtime, disappointed customers, etc.) or vice versa – they do not sell what they have in stock. ERP systems usually secure communications between these departments. Still, the logistics manager is often involved in the process too late or with too little information, which significantly hampers planning efficiency, and ultimately leads to human error and financial loss. Ensuring a constant flow of information between the sales department, production, and logistics managers is imperative. Only in this way will the production department be able to deliver the products on time, or customers will receive the products either on time or be informed ahead of time about any changes. Thus, it would be worthwhile to take care of the TMS system and the fact that it would serve as the only source of information for all three parties about the entire logistics chain. Current technologies allow TMS systems to be connected via APIs to other systems you use, such as ERP.

2. Communication with the partners (external communication)

Three calls to the carrier, five e-mails, the plate numbers were transmitted via skype, and the delay was reported via FB messenger. Yes, this is how communication between a logistics manager and a transport company usually looks. It’s probably not difficult to observe a loss of time transferring information from one tool to another and passing it on to a warehouse and sales departments, or other colleagues, but the more significant loss is company data that gets lost not only on different platforms but often stays in employees’ memory or notebooks. Such companies cannot make long-term strategic decisions because they do not have a substantial historical database. Also, employee changes are often very painful financially because they take away information and labor that require a lot of time and extra effort to restore. Thus, the tool used by your logistics manager must be not only adapted to gather information but also easily integrates with your company’s internal systems. The company needs to ensure that all data belonging to it remains within the company and not in verbal but digital form.

3. Loading/unloading

Loading/unloading can be any extra point in the logistics chain, but let’s start with your warehouse. Usually, companies consider only two factors: how to get the raw material on time, and how to deliver goods to the customer on time. However, these factors, your logistics chain’s overall efficiency, and its final price are affected by other essential timestamps. Two examples of a poorly planned warehouse include:

  • Truck queues/congestion at the warehouse because everyone converges as they want and when they want. Or your warehouse doesn’t have a clear plan for when and what to load; therefore, time-consuming improvisations begin.
  • Your warehouse works significantly longer than needed, resulting in or exceeding the required human and technical support resources or inefficient use of them.

In this case, the warehouse loading/unloading time management tools help, and it is best to make them available to all parties (logistics manager, warehouse keeper, supplier, carrier, customer, etc.). Only in this way will you effectively plan the working hours of your warehouse and staff. It will be apparent to your staff when and what to prepare (including documents). Also, you will not pay downtime, as carriers will not have to wait in queues. The production department can clearly plan the receipt of raw materials and products’ production for optimal delivery. The Warehouse time slot system, which can be used as a stand-alone module or integrated with the TMS system or ERP you use, is perfect for these purposes.

4. Transportation partners

It is your “employees” working for other companies. Often, a manufacturing company buys transportation services based on the price it pays for transportation only. Still, we advise you always to answer these questions before you think about “the final price” of services.

  • Does my partner provide me with the necessary information on time? Is the high quality of service consistent with all my requirements?
  • Are my customers satisfied with the quality of delivery? Together with my partners, do we sell our customers a great experience?
  • Are my partners innovative? Do they meet the current standard and implement systems that create value for my clients and our company?

These questions help to assess the “hidden price” you pay in addition to the shipping price. If you want to streamline the logistics chain and communication, it is crucial to motivate your employees and ensure that your partners are inclined to help you grow and improve. Implement a KPI system for your partners to evaluate the cost of transportation and other critical criteria to you.

5. External opinion

We recommend that you consult with companies or consultants who work with logistics efficiency and have more than one customer, usually logistics solutions companies. Such companies will help you review and evaluate your needs based on today’s best practices and compare them with other companies’ solutions. Manufacturers often make the mistake of creating their own logistics management tools for several reasons: A) you will have to support it with internal or external resources – you are likely to overpay significantly in the end. B) Businesses want the perfectly matching solution to fit their processes, rather than being more flexible in their approach and implementation. After all, most such solutions are built on best practices. So adaptation, while time-consuming, often allows for the highest standards and go together with technology.

 

So, these are just a few tips that can be used to measure the first results. In logistics, as elsewhere, there are no boundaries to excellence. However, to have the opportunity to develop efficiency plans and improve existing processes continuously, you must first have a clear view of what is happening and how both your company’s employees and external partners operate. Digitized work results make it easy to identify achievements and areas for improvement while reducing operational work and leaving more time for meaningful tasks. These can be strategies to reduce shipping costs, partner ratings, or better delivery quality for the customer.

 

We at GoRamp are always ready for an open dialogue and search for solutions for your business. Contact us today and we will help you find a way to increase the efficiency of your business.

To learn more about GoRamp reach out to speak with us today.