Posted on 05-09-2017 by Lucia Garza
According to Adrian Gonzalez of Logistics Viewpoints, Walmart increased the efficiency of its private fleet by a whopping 69% between 2005 and 2012. The changes saved the company millions of dollars and had a net carbon reduction effect comparable to removing nearly 8,000 cars from the road.
How did Walmart do it? By taking common sense, data-driven steps to reduce waste and allocate resources as efficiently as possible. Given Walmart’s massive scale, your organization may not be able to match its achievement; that said, by adopting cutting-edge technology and emulating innovative shippers’ best practices, you can still boost your logistics operation’s efficiency by a similar proportion.
You can set all four of these tips in motion tomorrow with minimal capital investment and virtually no operational interruption. You might even be doing some already.
1. Use the Right Logistics Management Software
An efficient supply chain needs effective supply chain management software.
Aleksejs Volcenkovs of Capterra advises shippers to choose software that’s customized (or at least customizable) for their industry, compatible with existing hardware and software systems, and supported by a reliable vendor. Depending on the scale and complexity of your logistics operation, you may require multiple systems operating in tandem across the ecosystem. Hold each system to the same criteria — the fewer bugs and glitches you encounter, the smoother (and more cost-effective) your supply chain management operation will be.
2. Leverage Fleet-Wide GPS
Writing in Supply and Demand Chain Executive (SDC), Jesse Kaufman outlines five best practices to follow in logistics. One of his top tips: leverage fleet-wide GPS systems that allow you to track every shipment in the field, no matter how far-flung. If you don’t have your own fleet, find a third-party logistics provider or shipping partner that offers this capability.
3. Embrace the Internet of Things
The supply chain of the future is uber-connected. Business Insider has a high-level overview of the IoT capabilities and solutions now available for forward-thinking companies, and the list is impressive:
- Low-Power Wide-Area Network (LPWAN) sensors that “let companies track specific items throughout their delivery journeys.”
- Internet-enabled satellite tracking systems that track freight on transoceanic journeys and in other regions without LTE coverage.
- Bluetooth beacons that function in warehouses and retail environments.
- RFID tags and mobile scanners, a one-two tag team that has already revolutionized supply chain management.
Each of these solutions individually enhances shipping efficiency. The already self-evident business case for IoT in logistics is only likely to become more compelling over time, as is the built-in competitive disadvantage for shippers who fail to see the writing on the wall.
4. Consolidate Logistics Vendors
It’s called a “supply chain” for a reason: supply chains are comprised of many interlinking components, each of which has its own purpose, strengths, and weaknesses. Links that appear durable and well-formed at the outset can grow brittle and worn over time, and each additional link raises the risk of a disruption somewhere along the chain.
For many shippers, the answer lies in fewer, stronger links — links that can perform a variety of key functions, such as fulfillment, customs brokering, freight forwarding, and point-to-point transportation.
“The key for maximizing communication and efficiency is finding a company that performs more than one of those functions,” writes Kaufman. “The more tasks you can consolidate into a single vendor, the better.”