What Is Shipping and Logistics Management?

Posted on January 02, 2023

logistics and shipping managementIt is said that 20 percent of small businesses fail before reaching the two-year mark. These statistics seem grim but they can teach valuable lessons. One of the major reasons why companies fail is that they are not properly organized. When you run a business you will need to receive shipments and fulfill orders for your customers. This process often involves a shipping and logistics company. Shipping and logistics are vital to your business as it is the arm of your business that brings you the products you want to sell. 

Failure to properly manage this area of your business can be detrimental to the overall survival of your business. Here’s a closer look at why shipping and logistics management is so important. 

Logistics Management Explained

Logistics management deals with the movement of goods from one place to the next. There are several factors involved in logistics management. There is transportation management, inventory management, freight, and material handling. The final step in the process is order fulfillment. Good logistics management maximizes available resources so that revenue is kept at reasonable prices, manual labor is properly utilized and customer expectations are met. All of this results in a good customer experience

The bottom line is that proper shipping logistics management is vital. If logistics are not properly done, it can reduce the efficiency of your business.

Goals of Logistics Management

Logistics management can help to make shipping and logistics processes run smoothly and efficiently. The first goal of logistics management is to increase revenue for businesses. 

Moving goods from one place to the next is expensive and logistics management is only effective when costs are kept at a minimum. This allows your business to get more revenue from the products you are acquiring.

The more efficient your shipping and logistics management becomes the more you will see improvement in your operating cost structure. You will also see a reduction in the transportation cost and the result is improved customer service. 

There are also seven things you need to bear in mind when you are dealing with logistics management. You need to have the right, product, quantity, condition, place, time, customer, and the right price. Once you get all of this correct you will have efficient shipping and logistics management.

Benefits of Shipping and Logistics Management 

There are several benefits of using logistics management correctly for your business. Many of these benefits are essential if you want to run a successful business. If your company is not currently harnessing them then you should be.

Efficient Reverse Logistics

If your business has a good fulfillment service then it is likely that you will have minimum returns from your customers. However, no matter how much you try to satisfy your customers, sooner or later one of them will need to have something returned. 

Proper shipping and logistics management takes into consideration these processes to ensure the smooth return of items that customers find defective or no longer want.

Improved Customer Satisfaction

Now more than ever you need to make sure that you improve customer satisfaction. Customers now have a lot of power because they can go on the internet and leave reviews on social media sites as well as business directories. 

With this kind of power, you must try to maintain a high level of customer satisfaction as it will impact negatively on your business. Many people base decisions on whether they want to work with or buy from a shipping logistics management from the reviews they see online.

The fewer interruptions you have when dealing with logistics the more likely it is that your products will get where they need to go on time. The result is that you and eventually your customer will be more satisfied as their order will reach them on time.

Save Money

Effective shipping and logistics management gives you a lot of control over your inbound freight. This means that you can keep your inventory at the right level so that you always have adequate supply and demand for the products that you sell. 

Adequate logistics also ensure that you use the right type of transportation for your products. When all of these factors are working together you will end up paying a lot less for shipping goods. 

There are two main types of supply chain processes you need to know about. These are inbound and outbound logistics. You will need to master both of them if you want to save money for your business. 

Inbound freight can account for a large percentage of your supply chain cost and if you cut costs for your inbound logistics you can pass on the savings to outbound logistics.

This means that you can charge your customers more reasonable rates for your products and reduce their shipping costs. All of this helps to boost your customer retention and help you to gain new customers as well.

Streamline Your Logistics and Shipping Management  

Shipping and logistics management are critical to the survival of your business. Having a reliable way of receiving your products promptly is vital.

Being able to fulfill customer orders quickly is essential for the growth of your business.

Failure to properly manage your shipping and logistics can result in lost revenue and decreased customer satisfaction. All of which can be detrimental to your business. Be sure to choose a reputable company to do your shipping and logistics for you.

If you would like help with your shipping and logistics, please do not hesitate to contact us today.