In today’s business environment, logistics plays a critical role and has the potential to generate a lot of value to the service quality provided to customers. At the same time, companies will have to invest in their inbound logistics and outbound logistics processes if they wish to generate cost savings, improve their brand image, increased productivity, and gain a significant competitive advantage, among other such advantages.
It’s very common for people to associate logistics activities part of the supply chain with the distribution and transportation of a finished product from the company to the end-customers. Nevertheless, the processes needed to manage a well-functioning supply chain go beyond just the final delivery stage. This is where the differences between inbound vs. outbound logistics come into play.
What are Inbound and Outbound Logistics?
Inbound logistics cover the processes and procedures surrounding the transportation, storage, and delivery of goods and/or raw materials from vendors and suppliers to your facility. The main challenges of the inbound logistics process revolve around finding reliable suppliers in a competitive price range, forming and maintaining strong and strategic relationships with these suppliers, finding a balance between inflows and outflows, managing on-time transportation from all suppliers, and maintaining a solid storage and quality control process
Outbound logistics refers to the processes and procedures that pick up from where inbound logistics left off and all the way to the transportation of goods to their final destination. The main challenges that surround outbound logistics operations include things such as the effective processing of customer orders, preparing the goods for distribution, issuing all necessary documentation, working with reliable 3PL logistics partners, implementing reverse logistics, route optimization and risk management, and keeping track of the cargo throughout the entire process, from the distribution center to the customer.
The efficient management of both inbound and outbound logistics processes is the key to success in supply chain management. There are several important factors that will help you streamline your transportation and logistics practices. Among these, we can include the following:
Planning and Due-Diligence
Any effective strategy will require a fair degree of planning and due diligence. Logistics and supply chain management is no different. The purpose here is to obtain the maximum amount of work done in the least possible time, all the while keeping your processes and procedures at the highest possible standards. Any good supply chain or logistics manager will have to plan ahead to ensure that most delays will be eliminated before causing problems throughout the whole process. They should also prepare themselves for any possible unforeseen circumstances that relate to the sourcing, purchasing, production of products, the unavailability of transportation, or any other internal issues within the organization.
In today’s evermore digital and technological world, automation plays a key role in increasing efficiency in an organization. There are several ways logistics companies can automate their processes including things such as the tracking and monitoring of every delivery.
- Using Useful Software – By implementing business management software such as Enterprise Resource Planning (ERP), companies will have access to real-time updates regarding the movement of their goods. Both warehouse operators and clients will get details regarding the state of the goods dispatched from the supplier, the procurement of goods at the warehouse, and the delivery of those goods to the final destination. This high degree of accurate tracking will improve the overall process management and will save time since any manual interference will be eliminated.
- Automated Machines in Inbound and Outbound Logistics – Robotic mobile fulfillment systems (RMFSs) are a new type of warehousing system that uses robots instead of sending human pickers to the inventory area to look for and pick the ordered items. These robots will carry shelves (known as pods) that include the ordered items from the inventory area to the picking stations. At this stage, human pickers will put the ordered items into totes, which will be transported via a conveyor system to a packing station. This type of system still relies on human pickers but relieves them of the responsibility of actually going out into the inventory area to bring the items back to the picking area. Robotics technology is not only limited to outbound logistics, as it can be used in inbound logistics, as well.
- Automated Vehicles – Large organizations such as Google, Amazon, and Walmart have already launched autonomous vehicle pilot programs. These types of driverless vehicles will provide supply chains with access to an almost inexhaustible means of moving products to and from the distribution center. This will overcome challenges involving driver shortages or capacity crunches.
Another effective way of optimizing both the inbound and outbound logistics processes is by expanding and maintaining strong and strategic relationships with supply chain partners and customers. On one side, your existing customer base will provide you referrals that will be able to drive long-term growth. On the other side, a strong and unified cooperation with your partners will allow all activities to run through a centralized system. This will ensure that the supply chain will become more efficient and less expensive to manage.
Warehouse Management Systems
Any effective logistics management would be incomplete without the use of a warehouse management system (WMS). This is a software application that supports and optimizes your warehouse functionality and distribution center management. WMS systems use a database that’s configured to support all sorts of warehousing operations and contains a wide variety of warehouse elements, such as individual stock keeping units (SKUs), weight, dimensions, manufacturing dates, case packs, automatic ID labels, etc. It also includes warehouse storage location information, as well as expected labor productivity rates. The use of a WMS will not only help you optimize and coordinate the inner workings of your warehouse but also position your company as a sort of centralized information hub for both your customers and supply chain partners alike.
An Effective Transportation System
Transportation is a key element in determining a company’s logistics and transport costs. Businesses are constantly looking into better methods of moving their products in more cost-effective ways. Some of the factors that influence this decision-making process include optimal delivery routes, cost-effective packaging, as well as lead time to provide different modal options such as rail, air, or barge. Other factors may include things such as the distance from the distribution center to the customer, as well as the different types of logistics tools and services that will affect the overall delivery and quality of products. This is where transportation management software (TMS) comes into play. Simply put, a TMS solution will handle all transportation operations for both outbound and inbound freight and will also offer suggestions on the best routes to use, among other such benefits.
To have a chance in today’s highly competitive business environment, companies need to look into the best ways to optimize their inbound and outbound logistics processes that make the most sense for their organization. If you need help with your optimization, Redbird Logistic Services is here to help!! Contact us today and work with a professional 3PL logistics provider!