Poor logistics planning and decision-making can result in excessive expenditure, missed delivery deadlines and damaged goods. This being the case, optimising operational efficiency and reducing logistics costs is among the top priorities for any logistics service provider that strives to sustain his or her business in a cutthroat freight environment.
Given today’s high customer demands and a fluctuating global business climate, logistics managers are facing more challenges than ever before. Cutting transportation costs makes the top of the list, followed by:
Additionally, staying on top of new advances in business processes has become an increasing challenge for logistics managers.
Consequently, a constant commitment to drive down costs is vital to survive in this hyper-competitive marketplace. To succeed, LSPs must rely on smart logistics management practices.
The only way to reduce logistics costs and supply chain expenditures is to utilise your resources in a better way. In other words, the energy use throughout the end-to-end journey of freight needs to be lowered. You can optimise the use of resources by:
For logistics and transportation companies to achieve this, supply chain integration is key. Hence, companies universally are turning to cloud-based technologies for supply chain collaboration and interoperability. This is digital logistics.
Digital logistics – ie. getting rid of paper processes entirely, so that all information exchange between logistics stakeholders is electronic – enables LSPs to implement major strategic changes to provide visibility, reduce costs and increase customer service levels. SaaS solutions that run supply chains as open collaborative networks double the utilisation of trucks, enable a 50% emissions reduction and a reduction in freight costs of up to 35%. This gives companies a competitive edge in the challenging T&L market.
By enabling the smooth collaboration of multiple shippers of goods and multiple logistics service providers, the SaaS model and mobile applications can make the omni-channel retail marketplace cost-efficient and carbon-friendly for all involved.
Cargo from a wide variety of shippers take the most efficient path to a given hub, where it is all consolidated into a single delivery to the end consumer.
For many companies, adopting new technologies can seem like an overwhelming and costly undertaking. However, implementing SaaS solutions requires low initial investments. You pay as you go. And you do not need to replace or disrupt existing systems. Besides, the SaaS model means there are no equipment or IT management costs. No professional IT teams are needed to manage the infrastructure. Upgrades are free, coming online as they are ready for implementation.
Up to half the cost of many supply chains is ignored and unmanaged in outbound logistics and behind the closed doors of distribution centers. Much of this cost can be eliminated by applying efficient supply chain management techniques. The emergence of cloud-based solutions for supply chain collaboration has made this considerably easier and more affordable than ever before – so even small companies can take advantage of it, without risk.
By ensuring that operational resources are used as efficiently as possible, these new technologies meet logistics companies’ internal need for lower costs as well as those of their customers, who also want a low-cost, hassle-free and on-time delivery service.