What the last two years have taught us is that we need to move faster to develop more resilient and agile solutions in supply chain, especially in distribution and transport operations. This means that it is important to have contingency plans for any unforeseen disruption including natural disasters, political and economic upheavals, cyber security events and further pandemics.
Changes in the B2B and B2C marketplaces are continuing to create major pressure on logistics networks. The objective stays the same: reduce costs, minimise risk and satisfy customers.
Reviewing your logistics strategy should be at least an annual event: see where you can cut costs and reduce expenses, mitigate risk and improve customer service – it is a circular process. Even the best-designed logistics networks need to continually optimise warehouse facilities, review inventory levels and streamline deliveries.
Distribution and transport solutions that worked two years ago are probably no longer fit-for-purpose.
Agility and resilience
More agile solutions are needed to support the trend towards more frequent deliveries, smaller order sizes and shorter lead times. Building resilience into complex supply chains requires real-time reliable data to make informed decisions. Many organisations are struggling with inaccurate and out-of-date information poor analytics capability as well as a lack of transparency. The move towards a more remote work culture is making the leveraging of real-time data even more critical.
Increase data visibility
Clear visibility into your transportation spend means improved business intelligence that produces smarter data-driven decisions. Benefits include the more efficient selection of carriers, benchmarked freight rates and better agreements with key supply partners. Data must be collected digitally and be analysed to be processed into usable information.
Examples of data items that can be collected per trip should at least include:
•Date of scheduled and actual pick-up
•Date of Scheduled and Actual Delivery
•Origin and Destination
•Any special Circumstances
Real-time data allows you to control costs, measure performance, amend processes, improve delivery times and boost overall company performance.
Adopt new technologies
Cloud-based software-as-a-service (SaaS) solutions are becoming essential for mid-size organisations. Cloud computing can be applied to all or part of logistics operational processes. Applications range from full-service ERP systems and real-time transportation visibility platforms through to individual software modules that manage functions such as safety and security. A transportation management system (TMS) is the most common application that companies are using to drive competitive advantage.
Some of the main functions available in leading TMS systems are:
•Route and Load Optimization
•Reporting & Analytics
•Supply Chain Communication Platform
•Logistics and Supply Chain Data Repository
•Business Intelligence (BI)
Modern TMS’s are easy to implement, user-friendly and affordable. The best solutions offer customisation and can integrate with partner systems. Vendors are continually upgrading them to improve data visibility and transparency in order fulfillment. Implementation of the right technology tool will reduce errors, improve resource efficiency and deliver customer satisfaction.
Develop supplier partnerships
Long-term, trusted partnerships can make any operational changes simpler and quicker, with open and ongoing communication. Sharing information on performance and market conditions and investing time in supply chain planning delivers value through cost reduction and process efficiencies.
Risk mitigation is essential to maintain the integrity of every supply chain. You need to re-evaluate current risks and identify any new risks to your organisation. The next step is to prioritise them by probability and level of impact (where possible!) and develop mitigation plans.
Digitisation and the increased implementation of technology increase the risk of a cyber-attack. Ransomware or other threats can damage your business. Develop a cybersecurity strategy that includes training staff and employing an up-to-date network security mitigation tool to avoid digital disaster.
Consumer pressure is already exerting a great influence on retail and FMCG supply chains and this will continue. Whether you are a B2B or B2C operation, or whichever industry you are in, you are likely to feel the pressure of the drive for speed and convenience.
There will be renewed pressure on reverse logistics and the circular supply chain. The thinking consumer wants the products that are returned to be handled responsibly, i.e., reused, recycled or disposed of ethically.
Specific areas of concern are reducing GHG emissions, eliminating empty miles and packaging waste. Companies can ramp up their sustainability efforts by measuring, benchmarking, and improving freight transportation efficiency. This has the effect of either satisfying the B2C consumer or contributing to the sustainability goals of B2B partners and customers.
The effects of the disruptions during the last two years will continue to be felt in 2022. There is a never-ending requirement to reduce costs. A lower-cost base means a significant advantage in the marketplace. Efficient end-to-end logistics operations that satisfy customers are increasingly being driven by the application of new affordable technologies.
For further information visit www.sccgltd.com or call our head office +44 (0)1926 430 883