Logistics management

The essentials of logistics management

Logistics management and supply chain, what are we talking about?

The supply chain is a particularly complex business environment, since it is made up of several layers and involves a large number of service providers. Logistics involves the efficient management of flows of raw materials, semi-finished products and finished goods, from their point of origin to the consumer.
Three distinct flows circulate along this chain:

• The physical flow, which corresponds to the transportation of goods.
• The financial flow, which refers to transactions between the various players in the chain.
• Information flow, which is essential for optimizing supply processes.

The importance of good logistics management

From order preparation to final delivery, today's consumers demand complete transparency from companies. Efficient management of information flows is therefore essential. The ability to track merchandise in real time and the punctuality of carriers are now imperatives for all logistics and transport professionals. Customer satisfaction comes at this price.
To meet these requirements, well thought-out inventory management is of course essential. As we explained in this article, it enables us to drastically improve warehouse turnover rates (integrate internal link), and thus optimize the company's financial flows. This data provides a precise idea of the relevance, quality and degree of obsolescence of a product.

Optimizing logistics management

Methods and best practices for optimizing inventory management

When it comes to inventory management, two pitfalls must be avoided: overstocking and understocking. In the first case, the costs associated with overstocking will inevitably undermine the company's financial equilibrium (maintenance costs, warehousing, wages, etc.). In the latter case, the likelihood of stock-outs, and hence late deliveries, increases automatically. Rationalizing supply chain processes will help avoid these problems Optimizing inventories most often involves good upstream supply management, the choice of the right inventory release method (FIFO, LIFO, FEFO), but also the calculation of key performance indicators. More on this later.

Picking optimization methods and best practices

Warehouse order picking is a major challenge for the supply chain, particularly in the face of the development of e-commerce. However, picking, which consists in grouping goods where they are to be put together, can easily be optimized From a "man-to-item" vision, logistics has recently moved to an "item-to-man" approach. Warehouse robotization, voice-activated order-picking systems and the digitization of the supply chain are now saving operators precious time. Of course, an optimized storage system for picking requires an infrastructure adapted to the chosen method. These include dynamic shelving and racks, mechanized handling tools, and the use of electronic terminals to locate picking locations. Particular attention will also be paid to the quality of referencing and labelling.

The most appropriate management tools

The development of e-commerce and the changing needs of consumers are driving the need to digitalize the supply chain. Scalable and easy to integrate into any IT environment, solutions must be designed to optimize the steering and management of the supply chain for professional players. They are also highly adaptable to the specific constraints of certain market sectors.

KPIs to monitor

Logistics KPIs are key indicators for measuring the evolution of your processes and implementing optimization actions They may, for example, relate to supplier order compliance, transport costs on sales, fleet utilization levels, storage unit costs or last-mile performance. Of course, the relevance of these indicators will vary according to the company's specific needs. Using a well thought-out WMS will enable you to configure and calculate the indicators best suited to the characteristics of your structure.

The benefits of digitizing logistics management lie in the operational excellence it provides, its agility, and the cost optimization possibilities it offers.