How To Improve Logistics Performance
Many businesses rely on the management of logistics to attract and keep customers. Your company’s distribution success depends on a multitude of factors, which is why making improvements can seem daunting. It’s an interconnected web, where every element depends on the success of another one. To reach better results and improve performance, you have to observe the whole of the operations while making changes to individual parts. If you don’t know where to start, here are a few areas that need the most attention in logistics.
Utilize Automation Wherever Possible
There have been countless advancements in robotics in the past few years, and the logistics industry has taken note of this. Technology and automation can improve the performance of your facilities significantly if you apply them correctly.
It should come as no surprise that robotics has become so prevalent in logistics. Why use human personnel to move products around a warehouse for eight hours a day if a robot can do twice the work without ever stopping. Management and identification systems allow automated software to sort through thousands of packages in a fraction of the time that a person can. With a well-managed conveyor, you can increase productivity tenfold without having to pay for ten times the workforce.
Of course, you shouldn’t replace your entire staff with robots just because it might end up being cheaper. People are better at dealing with highly specialized tasks, and you need staff to guide and take care of the warehouse robots. On the other hand, automated machines are better at minimizing product damage during transport. Integrating both automation and a well-trained workforce is the ideal choice for improving logistics performance.
Increase Warehouse Efficiency
A key part of logistics performance is the efficiency of your warehouse. There are numerous ways to better utilize space and operations and speed up the process of transporting products. Common problems in warehouses include difficulty locating and reaching certain shipments, which can slow down the operation.
It’s important to manage your warehouse in a smart way. Consider seasonal differences for specific products. If you can expect an influx of popularity for a particular type of item during a season, make sure to place them in locations where they can be reached easily during this period. Analyze your stock and see what sells quickly and what doesn’t. This will tell you how to arrange your products based on how easy they are to reach by personnel.
Apply Standard Operating Procedures
Logistics requires a great deal of communication and coordination. Because of this, optimizing operating procedures is a must. They ensure that the members of your team can strive towards a united goal.
There are many areas of operating procedures that are worth reviewing, including packaging, information sharing, and warehouse activity reports. Outline a plan for these types of tasks that all personnel will follow, so that your business can keep up with market trends. Monitor KPIs to see how individual areas are holding up when it comes to scrutiny. You can use the metrics to determine where you need to make immediate improvements and how changes have affected your facility’s performance.
Observe the Competition
Like all other businesses, logistics is inherently competitive. A key goal of your improvements is to obtain clients that your competition is vying for at the same time. It’s worth noting that there’s a lot that you can learn from other logistics businesses. Keeping an eye on successful trends is a good way to quickly improve your own performance and stay ahead of the game.
Observe how your competitors manage their businesses. How do they allocate space? How much product do they keep in a warehouse, and how do they avoid overstocking during a popular season? Which professional freight companies do they hire to move their products? These are all key questions that can help you get a feel of how your business can improve. There’s no reason to brainstorm from scratch, as you can apply business models that have already shown to be successful. Combine this with your own strategy and you’ll always be ahead of the competition.
It can be difficult to assess the success of your changes if you don’t have solidified goals. You should analyze your current business practices and set multiple goals for the following years. Create a realistic timeline for specific changes and see how they impact your business’s performance.
Once you’ve reached a certain goal, you should always look to make adjustments to your operations. During this time, the market may have changed, or your business could be looking at new opportunities. Don’t treat your goals and timelines as if they were set in stone. Use them to gauge the effectiveness of changes. Along the way, you can and should reevaluate things and make changes accordingly.
Logistics performance plays a major part in improving your customer relations. By raising your standards and introducing changes, you will attract customers that are looking for higher quality service. Consider the above examples and apply them wherever possible.