Changes in customer behaviour due to the growth in e-commerce and the availability of affordable technology solutions for B2B businesses continue to impact logistics operations. Logistics planning is essential to your business’s success: it forces you to think about your business goals, both 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 logistics plan, there will be no reliable supply of products for sale, nor methods of ensuring you can satisfy your customers. You need to plan for projected sales growth, sourcing of products, transport costs and availability of resources. What you can’t foresee is supply chain disruptions. Changes in government regulations, natural disasters or geopolitical events can all have consequences. Remember Covid 19? Even the best-laid plans are subject to change so agility is important. Having a solid logistics plan, with contingencies in place, means that you will be able to meet customer expectations, despite setbacks. Effective data management is the basis of good decision-making, and embracing the supporting technology is now vital. Optimising your logistics is a process, not an event.
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. Inadequate resource planning of people, equipment, and technology impacts your ability to serve customers.
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.
Continuing to plan on Excel spreadsheets and having no access to reliable and accurate data will slow down your business and reduce your competitiveness. Digital solutions using mobile technology tools and automation are having a major 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. A poorly planned returns process has a direct effect on customer retention.
5.
Lack of visibility into the supply chain
Poor access to reliable historical data means you’re planning process is likely to be less than reliable. When you have incomplete or unverified data, costly errors occur, and resources are wasted. Supply chain visibility refers to more than track-and-trace, it refers to all order flows, inventory, and fulfilment across multiple locations.
What should you do now?
A proper logistics plan will allow you to control costs and deliver a superior customer experience. Having a solid plan means being able to scale up or down as circumstances change without stress on operations.
