Why logistics chain management is so important

Sharp increases in sea freight prices are impacting the international transport sector. This and other circumstances threaten the viability of many companies, who are beginning to understand the importance of improving their logistics to minimise impact.

The container crisis and how it threatens international logistics

The pandemic is taking its toll on the international transport sector. This is largely due to the shortage of containers available to transport goods from Asia to Western countries. This phenomenon is already known in the logistics field as the “container crisis”.

If we add the congested international ports affected by outbreaks of Covid-19, we are dealing with a logistics chain that is running on empty.

Container freight prices have doubled, and this rise is set to keep continuing, which could lead to delays in the delivery of products, shortages and rising final prices for the end customer.

Far from being temporary, experts are predicting that these international logistics chain disruptions will continue well into 2022. The Delta variant and its impact on Chinese freight or port closures continue to generate great uncertainty. And in the United Kingdom, the shortage of carriers following Brexit a climax for a turbulent few months to come.

While demand continues to rise, complications have been forecast for the 2021 Christmas campaign. Many large companies are actually preparing to advance their imports and to improve their own logistics chain management in anticipation of significant delays.

Logistics chain management

Proper supply chain operation is vital to the growth and improvement of any business. Optimising the supply chain is actually a critical step in scaling production and expanding a business.

A strong logistics chain is the one that successfully manages the relationships of exchange between all the companies, whether they are suppliers, partners and carriers taking part in it. This involves an exchange of both material and the information generated in this process.

Comprehensive logistics

Comprehensive logistics is a supply chain management and organisation model aimed at increasing flexibility and minimising disruptions.

Resources, merchandise, information, operators, and departments are integrated and working in sync, making the operation flow much more smoothly and orders depart more quickly.

If there is one good thing about this strategy, it is how it deals with the omnichannel retailing challenge. In other words, when a large number of small orders must be delivered as quickly as possible. This usually takes place in the retail sector or targeted campaigns, such as during the Christmas season, which can be planned in advance.

Benefits of comprehensive logistics

Some of the benefits of a well-organised comprehensive logistics are:

  • Increased agility. The workflow will respond faster to customer needs.
  • Increasing competitiveness and the ability to expand into new markets.
  • Reduced costs. Improved processes and reduced operational costs.
  • Greater flexibility. This makes it easy to manage more orders as well as adapt to a more uncertain environment.
  • Efficient stock management, allowing only the necessary items to be available at any time.

How to implement comprehensive logistics management

Implementing comprehensive logistics in a company requires the involvement of all departments and the evaluation of each process. This requires analysing a multitude of factors related to product, managing transport and delivery, warehouse movements, demand, etc. Merging all this information allow plans to be drawn up to anticipate and even overcome crisis scenarios such as the one that is currently taking place.

However, implementing a comprehensive logistics system can be a costly process for a company in a range of ways, as rather than involving one common solution, it needs to be customised for each organisation. That is why the best solution is to contact a professional logistics operator such as Bilogistik, whose comprehensive service allows us to be able to manage your company’s logistics.

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