Logistics Planning and its Role in the Evolving Supply Chain
Logistics is key to an efficient supply chain which involves the planning and movement of goods, services, and information from the point of origin to the point of consumption. In fact, logistics goes one step ahead to align the complex operations of transportation and shipping, import and export operations, warehousing, inventory management and production scheduling, with the organizations’ overall goals.
With 77% of major global ports staring down snarling backlogs, there is an urgent need to prevent unstable and tense supply chains from toppling into any further chaos. Logistics planning plays the role of an important blueprint of the supply chain and is used to coordinate and monitor resources to help distribute products and services to the right customers at the right time.
Logistics planning aims at linking and synchronizing the overall supply chain as a continuous process and is essential for effective supply chain connectivity.
A salient Logistics Planning solution provides the following benefits:
Business Problems Solved with Logistics Planning
1. Ambiguity in Inventory Visibility, Tracking, and Management
Since inventory acts as a foundation for a successful and efficient supply chain, mid-sized to large scale businesses, may find it difficult to track inventory status and movement due to lack of detailed, real-time visibility. This can significantly strain a business’s sales and operations activities. Also, as the supply chain often needs to track and manage inventory from various warehouses and locations, this can be a difficult task with decentralized operations.
To help address this, a Logistics Planning solution that can provide valuable real-time data on inventory is a good option.
- To help easy access, anyone, in the organization regardless of the location across several systems, like warehouse management, transportation management, etc.
- To help ineffective tracking and management of inventory across the organization saving time, money, and resources.
2. Mounting Transportation Costs
Transportation costs form a major chunk of the several variable costs that operators have to address. Rising fuel prices directly impact the shipping costs and they become an integral part of the logistics budget. A steep rise in this can further create a dent in the overall revenue stream and profitability.
A good Logistics Planning solution can help address the above costs to a great extent.
- By implementing autonomous tracking and AI in supply chain and logistics, the solution has access to the potential real-time data with prime routes as well as possible alternative routes to reduce the cumulative transportation costs.
- By deploying sensors, operators can further intelligently improve fuel efficiency, evaluate various road conditions, and continuously monitor routes for tracking everyday logistics to optimize efficiency.
3. Complexity in Deriving Logistics Analytics
Most logistics managers find themselves struggling with driving valid outcomes using accurate logistics analytics solutions. This is due to the growing competition within the transportation and logistics industry along with the rising fuel costs, complex market demands, and the increased need for optimized delivery times
With a sound Logistics Planning solution, operators and managers have the ability to harness the true potential of their data to bring about significant improvements. This is across route optimization, traffic management, inventory movement, and predictive maintenance.
- Using accurate analytics and data, the solution can analyze the shipping history and operations, to cut down logistical costs and slash down shipment delivery times.
- Also, by applying AI-based techniques, the solution can develop advanced performance metrics and KPIs to create valid computer models to predict supply chain issues.
4. Managing Operational Shifts
Many times logistics planners face challenges in managing the batch units of operations scheduled based on certain assumptions. Due to unforeseen factors like market volatility, weather conditions, worker absenteeism, etc. which might affect these schedules, there could be a significant reduction of the units produced, impacting the transport capacity.
With an efficient Logistics Planning solution in place, logistics managers have the power and flexibility to adapt to these operational shifts by identifying the best routes, transport modes, and delivery windows.
- It can help reduce the possibilities of losses in resources and time to handle these changing variables.
- It can also help companies to provide for simulations or what-if scenarios, which can create fool-proof strategies to avoid bottlenecks occurring from operational shifts.
AI and its Impact on Logistics Planning:
Today, AI has assumed a strategic role in delivering the much-needed efficiencies across the logistics industry.
With uncertainties gripping the demand-supply dynamics in the logistics industry, companies have to transform their game plan. Continuous optimization of warehouse strategies, labour processes and fleet management is the only way to achieve sustainable, all-round efficiencies across the supply chain.
ThroughPut helps logistics and distribution providers with AI-driven actionable insights to analyze route, carrier and load efficiencies.
It also helps eliminate potential bottlenecks across the logistics value stream, helping logistics managers save millions in supply chain costs and boost the bottom line as well.
Take the first step towards holistic logistics efficiencies. Start with a