No matter what the size of your organization, logistics are an integral part of every business. It not only impacts the overall working of the unit, but it also plays a vital role in building strong customer relations. Today with companies going online, the need for a better and systematic logistics management has intensified. Research states that every minute, there are more than 1000 customers who are placing an order online. Therefore to tap this potential, logistics management is the key.
So what is logistics?
Logistics stands for administrating the complete flow of goods and information from the point of its origin to the end of consumption. It involves warehouse management, material inventory management, labor administration, and shipment related activities.
Is Logistics management important for Small Businesses?
Many have the misconception that Logistics management is critical only for big businesses; and, small companies can still operate with the manual methods of supply chain management. Business experts have always stressed on the early adaptation of automation in Logistics management. Thus companies that adopt the technology sooner see growth faster than the others who still practice the old-fashioned ways of management.
So how can small businesses benefit from Logistics Management
Even before you plan, ask yourself these three critical questions:
- What is the objective of your company?
Start with evaluating the USP of your brand. Does your brand promise the fastest delivery, if that is the proposition, then your delivery logistics have to be reliable; you need to spend on getting the best vendors who can live up to your promise. On the contrary, if the objective is cost-effective, then you need to cut down on other aspects of logistics and work out a plan that can make your products genuinely cost-effective.
- What do your customers want?
Quality products, on-time delivery, affordability or refund policy. Survey to understand why customers choose you over other brands. Once you know this, it will be easy for you to live up to their expectations. For small businesses where the budgets are tight, this analysis will help in making targeted decisions.
- How much should you spend?
Most companies make lavish expenditures on advertising, and thus very little is left for running an effective supply chain. So, plan your expenses wisely, visibility can bring you orders, but to fulfill these orders, you need strong inventory management. So having a robust and automated Warehouse Management system is crucial for all businesses.
- Do you have a contingency plan?
To keep the show running at all times, you have to keep a backup plan ready at all times. Suppose your supplier goes on strike, and you have orders to fulfill. How will you tackle this situation? Forecast the possible problems that can arise and keep aside a crisis budget for these situations.
- How should you manage logistics?
The answer to this is technology. There are many Logistics management tools available in the market that automates the entire supply chain process. These systems are designed to generate timely reports on how the organization is utilizing its cost, time, and resources. Based on these findings, companies can take calculative decisions.
Today is the era of start-ups, every year, there are more than 1000 start-ups registered across the world, yet only a few continue beyond five years; because they fail to adapt the change. So, whether you are a small business or a large business, without adapting to the latest technology and innovation, growth is impossible. These five questions will help you understand how to plan your Logistics to optimize your business.