Logistics – What’s in it for you?
“Logistics is the process of strategically managing the procurement, movement and storage of materials, parts and finished inventory (and the related information flows) through the organization and its marketing channels in such a way that the current and future profitability are maximized through the cost-effective fulfilment of orders.”
However, in today’s business environment, when suppliers, manufacturers, service providers and buyers are scattered around the globe, global Supply Chains go far beyond the physical movement of goods and information. And it certainly isn’t just about cost. In such globalized markets, an efficient and agile Supply Chain will become the critical make- or break- factor, which differentiates you from your competitors.
So, in real-life terms, what is “good logistics”?
• Lowest possible cost – all along the supply chain: Effectively, not only within the transport chain itself, but also in the most economical way of collaboration and interaction between the various departments and organizations, along the transport chain. Such jointly achieved cost savings ultimately benefit all companies, bringing a product to the market.
• Comprehensive door–door cost savings are hardly ever measured - representing a huge potential for both competitiveness and differentiation, towards your competitors.
• Delivery in time, all the time. Obviously, this is really the fundamental pre-requisite to JIT, which will open the doors to the OEM markets (for you to become a supplier to Original Equipment Manufacturers).
• Consolidated and centralized planning throughout your organization: Using standardized operational procedures (SOP), minimum number of movements, involving a limited number of accredited service providers - anything else is Fly By Night.
• Flexibility: Being able to overcome short-term obstacles, and still being able to deliver in time.
• Constant evaluation and improvement of your processes: Internally within your organization, between you and your appointed service providers, creating synergies and benchmark performance indexes with suppliers – all this, using jointly defined key performance indexes (KPI).
• Shaping your competitive advantage, jointly and directly with your customers: Through joint performance reviews, you obtain your customer’s immediate and on-going feedback, enabling you to anticipate their requirements for added-value services.
Implementing and constantly improving logistics, as a combination of value proposition, competitive cost structure, reliability and customer focus, is what will help you and your customers excel across the immensely fragmented markets across Asia.
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