How to Optimize Your Logistics?

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Today, each company in the sector has the main objective of optimizing its logistics. The more a company optimizes its logistics chain, the more productive it is and therefore able to satisfy its customers, whether in terms of speed in processing orders or delivering them, or even the availability of its items.

Optimizing your supply chain is essential and could put together an endless list of tips. This is why it is advised you to first follow the elements stated below:

1. Define your logistics strategy

Although this element may seem “elementary”, it is not necessarily always very well defined. Indeed, depending on your needs (number of daily orders, storage, staff, and handling equipment), you will need to determine the logistics strategy to apply.

Small logistics :

• This strategy is normally used in companies that do not exceed 50 PO lines per day.
• The logistics operators are versatile and perform several functions at once: picking, order processing, packing.

Structured logistics :

• It gets practiced in organizations that need to process between 50 and 1,000 order lines per day. Write the article in 3rd person.  Not “we”
• The operator's logistics are specialized positions.
• The picking can be performed by waves of orders.

Industrial logistics :

• If your business handles more than 1,000 order lines per day.
• To meet the needs of the business, this strategy requires the use of software and the robotization or automation of the warehouse.

Outsourced logistics :

This strategy consists of entrusting all or part of its logistics chain to a service provider according to the needs of its organization.

There are 5 types of logistics providers providing a different degree of service.

• 1 LP: transport.
• 2 LP: transport and storage.
• 3 LP: transport, warehousing, the flow of goods, and solutions related to information flow.
• 4 LP: coordination, and supervision of the logistics chain.
• 5 LP: logistics management and engineering services.

2. Appoint a person in charge of optimizing the supply chain

To avoid facing situations such as stock shortages, over-storage, or even customer complaints, it is essential to appoint a team or a person in charge of optimizing the entire supply chain. This means that these, or that employee will have to study the techniques used in your warehouse and evaluate the solutions that could be implemented to contribute to the improvement of the Supply Chain. Thus, you will be able to align your logistics strategy with all of the company's objectives.

3. Structure your warehouse

• Warehouse zoning: Defining the different zones of a warehouse is crucial since each part of your space must be intended to perform a specific activity (loading area, unloading, storage, over-storage, cold room, picking, etc.).
• Storage of goods: To avoid wasting time locating your goods, it is essential to proceed with what is commonly called addressing. So you can easily determine the location of your products, whether it is fixed or variable.
• Signage: This cannot get repeated enough that signage not only contributes to the safety of your warehouse but also to its proper functioning and increased employee productivity.

4. Practice cross-docking

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You have certainly already heard of cross-docking, this technique which, when receiving goods, allows you to bypass the storage stage and ship it directly.

As you will understand, cross-docking allows you to reduce your storage costs. So, if your inventory management needs to be improved, cross-docking may be the solution for you.

 

5. Identify areas of the warehouse where automation would be beneficial

Many processes in the supply chain are struggling to reach their maximum efficiency threshold, in particular, due to the lack of coordination that exists between them.

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Companies find it difficult to have a global vision of the supply chain and lose profitability especially when carrying out manual processes.

Automation is not a solution for all companies: small logistics companies do not necessarily need to automate their warehouse. 

There are various third -party companies that provide shop and ship service from Flipkart to the USA or any other country and have clients all over the world.  This is beneficial to those companies  to grow their business.

 

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To determine your need for automation, evaluate each of the processes whose production is below production standards. So you will identify the parts of your warehouse for which automation could be beneficial and select the warehouse management software that will meet your needs.

6. Set up a Lean Management method

Although this technique is not unanimous, Lean Management is nevertheless a good way to optimize each of its resources and improve the overall performance of its company.

Indeed, setting up Lean tools to increase performance is a very good idea, but if you decide to apply it, it is important that your employees are guaranteed to work in good working conditions. Remember that your employees should never be neglected, as this would mean taking risks with their health and therefore with your business. And by applying such techniques you are seeking to optimize your logistics and not the other way around.

As you can see, there are many ways to optimize logistics. The examples given above are more or less time-consuming solutions to implement, but their implementation must be able to be considered in order to optimize its logistics as well as possible.