With the growth of e-commerce , more and more companies are investing their resources in improving their logistics management. In fact, the large multinationals that we know today owe part of their success to taking care of their logistics management and customer experience .
The Apple company is an example of how a good investment in logistics can make a difference. In 1997, when the company brought its first iMac to market, it also announced that it would ship via airspace. That strategy dealt a blow to its competitors, who at the time were shipping by sea.
The importance of product delivery logistics is undeniable, which is why many companies decide to hire a logistics operator. In this article we explain what logistics management consists of, what a logistics operator and what its main functions are.
What is logistics management?
Logistics management are the processes that guarantee the movement of goods, packages and raw materials from their point of origin to the final customer. These processes can be both automated and manual, depending on the digital maturity of a company.
Logistics management is a core component of supply chain management (SCM). Supply chain management is the management of the production of a good or service, from the raw material to the delivery of the final product to the consumer.
Supply chain management deals with the entire process of purchasing, supplying, manufacturing and selling, while logistics becomes a bridge between the different processes.
To better understand logistics management, we detail its functions below:
- Order processing: All the activities of preparation, classification and shipment of the order, as well as the report on the status of the order.
- Material handling: Management and transportation of materials (raw materials, parts and/or finished products) from one place to another.
In this process, it must be ensured that no activity of the company is affected by the early or late arrival of the materials. It is also crucial that all materials are delivered to the right place, in optimal condition and in the right quantities.
- Packaging: For the handling and transport of any merchandise, the packaging is of the utmost importance to protect the products and/or their properties.
Good packaging is usually decisive in order not to suffer losses or damage in transport, transfer and handling operations.
- Transportation: One of the most important phases of the product delivery logistics process.
The transport company must take into account both the means of transport and the routes to be followed. The different modes of transportation available include road vehicles, freight trains, cargo ships, and air travel. Regarding the choice of routes, it is essential to analyze which are the most advisable to maximize the cost of transport and, thus, increase the final price of the product as little as possible. Logistics management programs like Vonzu will help your deliverers find the most efficient route.
- Storage: Previously, companies had the necessary space to store merchandise. However, there are more and more agents and intermediaries in the product marketing process. This has influenced the creation of logistics centers that facilitate the loading, unloading and logistics management of merchandise.
- Inventory control: This phase covers inventory management, recording quantities and locating items.
Why use a logistics operator?
A logistics operator is a company that designs, manages and controls one to several phases of the supply chain of another company. The new consumer trends through ecommerce make it necessary to implement a fast and immediate logistics management process.
In this sense, logistics operators become a strategic partner for a large number of companies and end up becoming that key advantage over the competition.
Among the innumerable benefits of hiring a logistics operator we can find:
- Cost reduction: By hiring an operator, you will save on transportation costs.
You will only pay for the contracted services without having to maintain a logistics structure.
- Improvement of the user experience: The logistics operator will ensure that the orders arrive quickly, efficiently and in good conditions to your client.
- Quality of service: Good long-term logistics management will position your company against the competition thanks to the improvement of the quality of service.
- Distribution networks: The logistics operators will put at your disposal a wide distribution network both nationally and internationally.
- Experience in the sector: If you choose a logistics operator specialized in your sector, they will have enough experience to satisfy the needs of your client and reduce product losses.
Logistics processes the nature of the company and its decisions about products. With these two examples you will understand how much they can differ:
A shoe manufacturer bases its business model on direct sales to the consumer. Its strategy is based on aligning the reception of raw materials with production programs so as not to have to pay for storage.
In this case, the manufacturer has to manage all logistics from start to finish, from supply to receipt, through manufacturing, packaging and transport to the buyer. If you hire a logistics operator, the manufacturer would save all that work to get their products to the end customer.
In the second example, a shoe store orders stock from designers and manufacturers. Final products will arrive at the retailer's main distribution warehouse for receipt.
In this example, as can be seen in the Netsuite , the logistics process begins with the receipt of the goods and continues with the movement of the goods to their final destination, which in this case is a physical store, not the customer. straight.
Transport and logistics are essential for the success of your company, since they are the physical manifestation of transactions and without transactions there is no business. hiring a logistics operator and/or using logistics management software like Vonzu , you will be able to manage the supply chain to gain efficiency and reduce costs for your company.