Category: 3PL

3 Key Communication Challenges for Logistics Companies

Crane lifter handling container box loading to truck

Ask any distribution company about their logistics alternative, and you’ll get another response for every one you ask. Every one claims to be much more efficient and quicker than the systems utilized by their competitors.

Any logistic alternative, however, should contain 3 elements:

Warehousing and Inventory Management

Kitting & Assembly

Communicating

Communicating not just on the verbal level, but also through monitoring and management software. While logistics options vary with each company, an efficient approach should contain a mix of these attributes. Warehousing and inventory management, the foundation of logistics solutions, go beyond storing and transport. While both these elements are definitely significant, they maintain a strategy stagnant and stuck before.

A warehouse should incorporate both these attributes, but also advancement, research, procurement, management, and distribution to bring your system to another degree. Communication also needs to be another component in effectively running a warehouse and stock management system. Communication Needs to exist between the warehouse and the purchasing program or authorities managers for regular customers using storage and inventory, particularly when it comes to maintaining supplies to fulfill mission requirements. With a warehouse and stock fully preserved, another step – kitting and meeting – should operate easily. In the end, all supplies are already in place. Packages that are assembled by the distributor via kitting and assembly often need to fulfill specific requirements.

In case of tactical equipment needed by this military, these are assignment requirements. Kitting and assembly should be done rapidly and accurately. Any package that’s shipped must be double checked and inspected first. From others is the technology involved. On a basic level, this might include tracking a package from start to finish. Total asset visibility software, and on the other hand, provides more than this. Used to shorten the logistics pipeline, such program increases requisition efficiencies, reduces order redundancies, automates validation, delivers visibility and standardization to internal inventory, and monitors the requisition and financing processes.

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5 Common Mistakes Made By Auto OEMs while Selecting Their Logistics Partners

Logistics Company


            Automotive manufacturers are known to raise the charge to develop innovative methods squeezing optimal profits from their production and manufacturing operations. While doing so,they tend to concentrate on optimizing profits and they end up neglecting the quality of logistic services which are provided by partners who matter most in the process. Sometimes, they are forced to get back to the supply chain with hope of gaining more efficiency only to incur unnecessary costs in the process.It should therefore be noted that while selecting logistics service providers, automotive manufacturers make mistakes that are critical to their industry in several ways.

  • First, most Auto OEMs pay much attention on the partner who would offer the cheapest services at the expense of the quality needed– Thus, the manufacturers’interest is usually on the immediate tangible cost savings as opposed to the intangible long-term cost savings. The short-term tangible cost savings include the avoided taxes on warehousing and transport as well as wages for the extra service that would be rendered. By focusing much on these savings, Low, Patrick, and Deborah argue that the manufacturer usually foregoes the amount of money that the industry would save through value addition if the product would be worked on by expert logistics (39). Similarly,they forego the profit they will be guaranteed on return clients or even referrals because of impeccable quality of products. For instance, cars that are made to withstand the dynamic climatic condition may warrant long to produce but would ensure high return on investment as compared to the feeble cars that only suit a condition.
  • most OEMs usually consider individual service providers, other than End to End Logistics Service Providers.Usually, end-to-end service providers provide flexible and integrated solutions that are perfectly designed to satisfactorily meet the needs of the clients. In the process, they guarantee fulfillment, they offer transportation services, third-party logistics, warehousing together with distribution,contract services as well as import and export platform (Seides 48). Failure to adopt this option leaves the automobile manufacturers with the trouble of having to deal with Multiple Firms, which only specialize in a specific service only. Eventually, they end up hiring several companies to render distinctive services such as transportation firms, freight forwarding firms, customs clearance firms and warehousing and 3pl firms. The process causes a myriad of issues with data transparency, resulting to the mismanagement of resources, and delays in the delivery of material among other technicalities.
  • OEMs still exist in a MYTH,that a firm comprising a larger trucking fleet size can guarantee assured service given the fact that the transporter has a large fleet of owned trucks.Thus, they suppose large truck owners can give them a desired service quality,not realizing the shortcomings of a fleet owner or even asset heavy setup. What the manufacturers forget is that often, fleet owners are more concerned with the optimization of fleet management, but not necessarily offering long term solutions to clients. 
  • Additionally, the quest to provide efficient metrics, automotive manufacturers creates strong partnerships with their third-party logistics. Se ides elaborates that this normally obliges them to invent new mechanisms of moving materials, which has always forced them to deal with the cost equation that emerged between 1980 and 1990 following the increased levels of complexity in the production processes of automobiles (115).
  • Finally, the fact that automobile manufacturers operate at a large scale nearly in everything creates ample room for mistakes as well. When one runs lean, there cannot be any possibility for mistakes, because when something goes wrong, it does not consume mush time and resources to correct as compared to the massive losses that are to be incurred in automobile industry (Low,Patrick, and Deborah 81). In other words, the level of risk and vigilance makes the manufacturers consider assorted logistics service providers to decentralize the risk.