Managing inventory, including warehousing and tracking.
Taking care of customers’ orders.
There’s a lot to logistics operations, and keeping track of it all is a huge task.
Management of supply chains is an on-going exercise that must be continued to improve efficiency in order to save money and meet customer expectations. It might be challenging to expand your business if you don’t have effective logistics management.
What is logistics management?
The logistics management of inbound and outbound shipments, as well as reverse logistics, is the allocation of resources to complete an order.
Managing logistics involves:
- Storing, ordering, and receiving merchandise across distribution centers
- Identifying and managing the inventory as it travels through the supply chain
- Using technology and automation to improve efficiency
- Warehouse picking and packing operations are often handled manually
- Assuring that items are delivered securely and on time
Why is logistics management important for your supply chain?
Logistics management entails monitoring the complete ecommerce supply chain, beginning with receiving finished products to shipping orders and ending in their ultimate destination.
The objective of logistics management is to satisfy customer expectations for correct and rapid delivery while minimizing internal expenditures.
Here are three reasons why logistics management is so essential for businesses that want to expand.
1. Delivers products accurately
In today’s ultra-competitive ecommerce environment, most direct-to-consumer (DTC) companies aim for a near-perfect order accuracy rate. While 100% isn’t always feasible, achieving a good accuracy rate falls between 96 and 98 percent. Any score below 95%, on the other hand, indicates room for improvement.
The goal of supply chain management is to establish accuracy objectives, enhance internal processes, and find methods to automate procedures in order to reduce costs and minimize human error.
2. Keeps logistic costs low
Poor logistics management, which is both unsuccessful and unoptimized, can raise logistics expenses, including storage and fulfillment fees, which may have an effect on your bottom line.
Logistics management methods can assist you keep logistics expenses low, including:
- Finding suppliers closer to your warehouse or store may help you save money on sourcing
- By shopping only on sites that are performing well, you can keep storage and purchase costs low
- To stay ahead of any adjustments in the supply chain, you must constantly optimize your logistics procedures
- Storing goods in areas where there is the most demand can help you save money on shipping
- In the case of goods transportation, outsourcing to a 3PL in order to save money in the end is a smart strategy
With the appropriate tools and know-how, logistics management may give insights into your operations that you can use to cut costs.
Tracking inventory in real time throughout the supply chain, on the other hand, can provide historical logistics data that allows you to forecast when to reorder more products. As a result, you’ll have a better sense of how much stock you need and when, which may help avoid stockouts or overstocking, both of which increase expenses.
3. Boost customer satisfaction
It ruins the unboxing experience if an order is delivered with the incorrect goods. If a client’s order is delayed, it has an impact on shipping.
Customer expectations are significantly influenced by logistics management. An effective supply chain is essential for the post-purchase journey to be effective.
It will not only be tough to optimize operations and keep costs low, but it will also be difficult to satisfy client expectations in terms of speed, accuracy, and price if logistic management is inadequate.
Ecommerce logistics can help you develop customer loyalty and a good corporate reputation if handled correctly.