As a business owner, getting products to a customer in a timely fashion can make or break brand loyalty. Even with the highest quality products and unique edge over competitors, the logistics process can be overwhelming– however, critical.
Aspects of running a business such as warehousing, distribution, and transportation could be the ticket to guarantee your longevity. That’s where a professional logistics service can make a difference and take your company to the next level, by getting your product into the hands of people who need it most.
What Is Logistics and How Does It Work?
The process that takes your product from the supplier to the customer is called logistics. It involves planning, implementing, and controlling how your product, service, or information moves within a supply chain. It begins with the point of origin and follows through to the point of consumption.
Trucking logistics follow this same planning while taking into account the many factors involved with transporting goods by truck. This includes planning the most efficient route for drivers to take, selecting the best fuel types based on market trends, picking the best truck to use for certain tasks, and hiring a competent staff of drivers.
This process begins with the logistics company obtaining the raw materials from the suppliers and manufacturers so the product can be made. The carriers, like trucking companies, ensure the materials are shipped, stored, and distributed for production.
Often, logistics services include tracking inventory, sourcing materials, and moving goods from the supplier to the company’s warehouse, store, or manufacturing plant. Once the product is finished it is then transported from your company to the customer or end-user.
Customer service and distribution channels of the logistics service typically handle this part of the operation. When a customer places an order, the sales or customer service team will check to make sure the item is in stock and send the warehouse the order to package and deliver the product.
How Would Logistics Help My Business?
A logistics service can increase your company’s efficiency by lowering costs, raising production rates, optimizing warehouse space, tracking and controlling inventory, and improving the customer experience. Let’s examine a few ways logistic services accomplish these tasks.
Warehousing
Purchasing or building a warehouse can require a hefty initial out-of-pocket cost. Using a logistics service can cut that cost considerably and negotiate better transport rates by taking advantage of volume discounts.
A trucking logistics company will also save you time by managing the supply chain for you. The equipment and supplies needed to store, package, process, and ship customer orders will be provided by the warehouse. Having everything in one place reduces costs and shipping time ensuring the customer will receive their goods when expected.
Packaging
There are legal requirements involved with packaging that warehouse employees are well trained to handle. Not to mention, you want your product to make it to its destination undamaged, and proper packaging plays a huge role in accomplishing that goal. Damaged products cost you time and money.
Trucking logistics companies ensure the packaging process runs smoothly. They can offer the packaging needed for specific items as not everything can be thrown in a box, shipped, and be expected to make it to the end-user. Many logistic services also have custom packaging at an additional cost available to distinguish your product from others and assist with company branding.
Shipping
With a logistics company handling your shipping life is much easier. They already warehouse and package the product, so shipping is the natural next step. Shipping a customer their order involves fees such as postage, fuel, choice of delivery method, and the selected delivery timeline.
The logistics service takes over that entire process and once again, everything is in one spot, so costs are drastically reduced. They handle the postage, fuel up the trucks, and get the package to the customer on time. They are also aware of any restrictions that exist based on the geographical location, or shipping zone, it’s being sent to.
Restocking
Properly managing your inventory is essential to your company’s health as it ensures there’s not too much or too little on hand. That limits the risk of out-of-stock items and inaccurate records. Depending on the product and how it’s shipped, the logistics service you choose may use different techniques for restocking your goods.
There are methods that identify the least and most sold items and forecast its restocking yield on these two aspects. No matter the system being used, automated systems are set up to track patterns and order stock as needed. The smart systems look for buying trends and cross-reference them with what’s currently on hand in the warehouse and/or store location, ensuring you won’t be without a product.
Time
Truck logistics companies have a lot cut out for them in today’s high-demand market. Customers have a number of shipping options, and they often want their product as fast as possible. Today’s logistics services have made that possible as you longer have to wait weeks for a package from the other side of the country to make it to your doorstep.
Expedited shipping has become the norm for many businesses and keeping up with these requests can be challenging if you don’t have a logistics service working for you. The last thing you want is to lose business because you couldn’t get the product to the customer in the time frame they requested. Hire a logistics company to handle the process and they’ll get the product where it needs to go in a timely manner.
Tracking
Keeping an eye on the movement of goods from location to location is an important part of transportation and delivery. Most logistics services offer technology that allows you to track the entire process as your products go through the supply chain.
Follow your raw materials to the production center, to the warehouse, and then to their final destination. These tracking services will save time and money in the long run as you can immediately pinpoint issues and quickly resolve them.
High-Quality Logistics Service Features
When choosing a company to handle your business’s logistics you want them to be trustworthy since they are handling the entire supply chain process. This leaves you time to dedicate to other areas like sales, marketing and promotion, and branding. So, let’s look at a few characteristics you want your logistics service to embody.
Communication
This is a key aspect that needs to be clear between your business and the logistics service. That means when a customer places an order through your website, sales team, or customer service department, it needs to immediately be dispersed to the logistics company for fulfillment.
So, choose a company that is committed to providing quality technology to connect to your website or existing software systems. All the information needed by the warehouse to select, package, and ship the product should automatically be sent once the customer’s payment is confirmed. Any delays in this process could reflect poorly on your company.
Credibility
How do you know the company you’re working with has a record of success? There are a few ways you can find out on your own.
Find a company that is transparent and offers to send you their delivery metrics. Reviewing this information is a surefire way to measure logistics service efficiency. You’ll be able to see a clear picture of their shipping time, order accuracy, and delivery time.
Also, ask about particular certifications from your logistics service provider. For instance, you may not know it, but certain parts of a shipment may be deemed hazardous. There are rules and regulations placed on handling and shipping these materials, seek out a logistics company that is well aware of those stipulations. A hazmat certification tells you that they’re well-versed in handling these situations and you’ll have nothing to worry about.
Be sure to ask plenty of questions and check online reviews to find out as much information as you possibly can about a third-party logistics service.
Stats and Information
Does the logistics company offer stats about the area of the business they’ve taken over? If not, find one that does provide you with regular inventory reports to ensure you’re using the service effectively. You can lose money just by storing too much freight for too long. Not moving the freight quickly enough or ordering too much for the current demand will result in monetary losses.
You want the logistics service to provide your business with an efficient information tracking and management system. Doing so will enable you to monitor each step of the supply chain process and build your trust in the logistics company.
Logistics vs Freight Forwarding
Freight forwarding companies partner with logistics companies to move your goods within the supply chain. Their primary job is to manage the imports and exports of your business and determine a delivery path for those goods. A freight forwarder decides the best method of shipping and handles all of the paperwork involved.
Logistics service providers own their fleets, warehouses, and other assets that make up their business. They cover all or part of the logistics activities and supply chain management and don’t just focus on moving the goods, but storing them, managing inventory, and packaging.
Depending on your business needs you may not need warehousing capabilities or inventory management and a freight forwarder would be a more cost-effective solution. But, if you have a large volume of items and need storage facilities, packers, and inventory tracking, a logistics company may be more suited to handle your needs.
Leave the Heavy Lifting to a Logistics Service Provider
Having a logistics service handle your products not only saves time and money, but it frees you and your team up to handle the aspects that will grow your business. You’ll benefit from the expertise these companies provide and the efficiency with which they operate. A good logistics company will help you reach your professional goals in no time.
FAQ
They include the purchase and delivery of the raw materials needed for production, packaging, shipping, and transporting goods to the distributors.
These are two terms used to describe the movement of goods using different modes of transportation.
A logistician commandeers the movement of freight by land, sea, and air. They oversee the supply chain from beginning to end.
Sign up for a FreightWaves e-newsletter to stay informed of all news and trends impacting supply chain careers and operations.
