Logistics planning is essential to your business’s success as it forces you to think about your business goals in the short and long term. An optimised logistics operation means delivering the right product to the right customer at the right time, at the lowest possible cost.
The importance of logistics planning.
Without a clear plan, there will be no reliable supply of products for sale or methods of ensuring you satisfy customers. You need to plan for projected sales growth, sourcing of products, transport costs and availability of resources. Having a solid plan, with contingencies in place, means you will be able to meet customer expectations, despite setbacks.
The five main mistakes in logistics planning
1. Inadequate forecasting
Inadequate attention to developing partnerships with suppliers, transporters, couriers, and other service providers puts pressure on operations. Forecasting is simplified when there are clear expectations for quality, delivery, and cost performance.
2. Poor focus on inventory management
Inaccurate inventory information can result in stockouts, excess inventory, and obsolescence. All of these can negatively impact your bottom line through increased costs and lost sales opportunities. Understanding your throughput and optimum stock levels is key.
3. Failure to embrace technology.
Digital solutions using mobile technology tools and automation are having a positive impact on productivity and accuracy.
4. Neglecting sustainability
Carbon emissions tracking and reporting is increasingly expected and likely to become mandatory. Adhering to government environmental regulations is not optional. Customers care about sustainable practices including waste, recycling, and re-use of packaging.
5. Lack of visibility into the supply chain
Poor access to reliable historical data means your planning process is likely to be less than reliable. When you have incomplete or unverified data, costly errors occur, and resources are wasted.
What should you do now?
A good logistics plan will allow you to control costs and deliver a superior customer experience as it means being able to scale up or down as circumstances change.
1. Improve your forecasting methods.
Work with your external partners to ensure continuity of supply and collaborate with sales teams to gather data on customer preferences and seasonal purchasing patterns. Demand forecasting technology tools can leverage your historical data, market trends, and other vital factors to provide accurate predictions.
2. Implement an inventory management system (IMS)
This will provide real-time visibility into stock levels across your supply chain. An IMS can analyse inventory performance, considering factors such as lead times, order quantities, and safety stock levels.
3. Harness modern technologies.
Productivity in the warehouse is increased by using modern automated equipment such as driverless vehicles, robots, and drones. Digital solutions using the Internet of Things (IoT), e.g. RFID, mobile handsets, and sensors which significantly improve human efficiency, lead to better planning. Warehouse management systems (WMS) streamline critical functions including order processing, inventory management, storage, and fulfilment.
4. Make data-driven decisions.
Leverage the power of data analytics to make better decisions and optimise your logistics planning. Digital platforms such as WMS and IMS gather and record data for future analysis and store it centrally for easy access. Inventory can be tracked in real-time; routes can be streamlined, and quality can be assured.
5. Set sustainability goals.
Understand your starting point and align your ambitions with your core business. Whether your stated goals are to reduce energy use, introduce disposable packaging, or reduce waste or carbon emissions, set realistic targets.
SCCG has the expertise to advise you on logistics. Our consultants can provide tailored recommendations to help you, minimising cost without compromising the needs of your customers. Give us a call on (+44) 01926 430 883 or info@sccgltd.com
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