In any business, efficiency is crucial. The businesses that can run quickly, efficiently, and react to changes as they occur, are the ones that have the most success in the marketplace.
One area of business that can cause efficiency issues is in business logistics. The following is an overview of what this is and a look at the best methods to assure efficiency in this area.
Logistics Management and the Internal Business Process
A business’ logistics covers several different aspects of its supply chain. It involves not only the transport of completed goods, but also order fulfillment, inventory of raw materials, warehouse and storage, and coordination between various third party suppliers. With the global reach of many businesses and their suppliers, supply chain oversight is a 24-hour-a-day process. It involves interacting with clients, suppliers, customers, and fellow co-workers.
How Supply Chain Management Affects a Business
An effective supply chain is often the difference between a successful business and an unsuccessful one. The current marketplace is very competitive and to be successful a business has to be proactive rather than reactive.
Businesses with bad logistics not only have difficulties moving their goods they also experience supply shortages, production issues, run into great difficulty reacting to outside events, and responding to sudden changes in the market.
Aside from the lack of a clearly defined mission statement on how logistics should be run, there is often a lack of communication in these companies as well. Signs of this include warehouses being unaware of where goods are in the supply chain and stores not knowing when new stock is arriving.
For business logistics to run efficiently, dedicated logistics management is essential. A logistic coordinator is a full-time position devoted to overseeing the logistics process to assure maximum efficiency using technology and computer software to track various aspects of the supply chain. For example, how goods are shipped (air, freight, etc.) and when they are shipped affect overall efficiency.
A business doesn’t want to create a situation where there are supply shortages or production is stopped due to an essential raw component being out of stock. To avoid this, constant oversight with clearly defined methods of supply chain configuration and function are necessary.
It is also important to be flexible enough to be able to respond to sudden outside factors such as natural disasters, a supplier running out of stock, or a new supplier being needed.
For a small business to be successful, it has to have clearly defined internal procedures to manage and oversee various aspects of the business. By having logistics services well maintained, a business becomes highly flexible and able to perform services not only quickly but also react as needed to changes in the overall marketplace.
At CapRock Services, we assist our clients in managing several key aspects of their businesses. Contact us today to learn more about how we can help make your business more efficient.