Increase profitability through the use of logistics planning tools

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logistics management

For the proper functioning of the Lean Supply Chain , logistics plans are essential. Using the right tools increases the profitability of a company and takes care of productivity cycles.

Logistics tools make it possible to fulfill the final tasks of the supply chain, from the correct storage of raw materials and articles to their delivery to the final consumer. 

Taking these ideas, optimizing the management of the logistics operation and finding errors in the established guidelines allow improving the established standards and increasing profits.

If you are looking for a way to take care of resources, improve processes and better satisfy the final consumer, knowing how logistics tools help will allow you to take into account the options that are available.

How can a logistics tool help you save?

Logistics tools help in the management of operations that are part of the distribution chain. Planning, control, tracking, picking and packing are vital in any company and detecting errors ensures the care of resources.

Saving money is equivalent to saving time and that is why getting a logistics tool that suits your needs makes processes easier. 

By growing your company along with technology, you ensure that the chosen software system generates profitability and adapts to the challenges that arise as the demand for a service grows.

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Having planning systems that help with cost savings and minimize expenses will not only take care of the company’s profitability, but also safeguard its competitiveness.

Additionally, these systems help improve the position of companies in the market, since they allow them to offer a better service while collaborating with cost savings and the reduction of time in internal administrative processes such as route planning or reporting. bills.

Profitability as a result of saving and avoiding errors

In Latin America, logistics costs range between 18% and 35% of the value of the products, as shown by the Latin American Logistics Profile (PERLOG) , carried out by the Development Bank of Latin America.

This means that if the costs are optimized and reduced, they will provide greater maneuverability in terms of the costs of the products and the logistics services that are offered.

Profitability as a result of savings is based on four key points. 

  1. Planning of distribution routes: by optimizing routes, making a selection of shorter routes and with better infrastructure. By taking care of these two characteristics, expenses or increases in fleet maintenance and fuel consumption are avoided. 
  2. Contingency plans: in the event of problems, they allow a quick response and provide a projection of how much the cost can rise and thus know the losses.
  3. Monitor drivers: Monitoring the productivity of carriers will help you control potential mishaps or route deviations that increase expenses and affect cost savings. 
  4. Communication with customers: having the means of communication to report on the status of the service reduces anxiety due to uncertainty. Inefficient communication channels become saturated servers that imply expenses due to wasted resources.
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Logistics tools are part of business strategies to increase profitability and perform better when linked with specialized logistics control technology . 

Is it worth investing in technology for logistics in order to increase profitability?

Incorporating a logistics planning system that simplifies route optimization processes and facilitates communication with carriers and the end customer strengthens the company’s financial structure and increases its profitability, among other benefits.

  • Time savings due to rapid management : this type of technological solution allows you to centralize all the information on drivers, routes, status and certifications, and offers a comprehensive display of information, which saves time and money.
  • Control of expenses : knowing how the resources are distributed and if the administration is well established allows identifying the effectiveness of each part of the processes, if errors are detected or a capital flight is found.
  • Increase production – With well-managed resource management and ongoing standardization of the right processes, you know what productivity capabilities you have and what improvements you can apply. 

With these three aspects, the profitability of the logistics chain is increased, simply by using a logistics system that is adapted to the needs that are had.

How long does it take to start obtaining profitability after implementing a logistics tool?

When starting the use of intelligent and intuitive logistics tools, the improvements begin to be noticed immediately, since the processes will be simpler by presenting an efficient methodology.

These tools also make it possible to identify areas of cost savings (such as in fuel or reverse logistics, due to the reduction of failed deliveries) and help to know how to implement improvements thanks to the information they make available to companies. In this way, they maintain competitiveness and increase logistics efficiency.

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Balancing costs and increasing performance thanks to greater productivity of services by cost control is achieved by contracting an intelligent logistics control service .

Conclusions

Considering the adoption of an optimization system that increases the profitability of a company is the first step to improve productivity; This is why each of the aspects that can be improved must be evaluated.