In the backdrop of global economic sluggishness, fluctuating fuel prices, increasing concerns over safety and subsequent social regulations, escalating expectations of clients, effects of globalization, streamlined technology, ever-changing transportation scenario, rising transportation costs, and declining capacity, shipping industry is exasperated managing their impacts. Managers handling freight shipping services nationally and internationally are faced with an array of challenges and opportunities that dramatically contrast with those of a few years ago.
The plights that hover over the transportation management industry have been aggravated by the factors that include growing shortage of truckers and falling transportation capacity. In such circumstances, shippers and core carriers find adapting to the changing logistics scenario to be difficult, resulting in operational shortcomings and missed opportunities. Spectacular among the chart of missed opportunities is completely leveraging the logistics management system as a decisive strategic part within the supply chain.
Logistics management system has a vital role in building flawless supply chain management system, which consists of suppliers, manufacturers, distributors and customers. This system plays an intriguing role in fulfilling the basic commitment of the supply chain management by moving inbound shipments from point of supply or origin to point of manufacturing units, shifting stocks among different units and distribution points, and then shipping the finished items to the customers. The benefits that should come from good shipping operations that include supply, production, and customer locations can never be realized without the integration of a good shipping planning and implementation. Getting stocks piled and available for delivery cannot be enough unless they are transported to the customer locations cost-effectively and in the face of needs. To make this supply chain a success, there are a few factors that need to be focused on. Those factors include Planning, Lane Operations, Carrier Choice, and Loading and Unloading Operation.
Planning: Freight shipping strategists need to first focus on the mode of transportation issue. They should have to decide which mode among their lots of varieties would be appropriate to keep up the flow of supply chain. Their plans should take into account of the supply chain flow issue, network design, tying up with best carriers only to enhance operational quality, ways to fulfill service commitments, and installing of ingenious and updated technologies. If they can ensure that they will have the bargaining power about freight rates with carriers, they will definitely be on an advantage position. Competitive freight rates if offered can attract more clients. But, sole freight rating cannot be enough to counter with best quality shipping services, which should always be of paramount consideration.
Lane Operations: Freight shipping strategists should focus on creating well-networked transportation design to streamline and coordinate product movement. This movement design should be in keeping with day-to-day operational freight shipping. Strategists should ensure that these functions can be performed cost-effectively. At the same time, value-added services need to be ensured. All these can take shape when lane operating planning prioritizes on freight consolidation which integrates supply chain components like vehicle, carriers, etc. Identifying the less dense lanes across all service regions for a logistics company is very important to streamline the freight shipping services.
Carrier Choice: The choice of carrier is very crucial for keeping up supply chain flow. Rail, air, ocean and truck are the ways to transport goods to defined locations. Shipping companies should have ties with the carrier companies that have all these transportation facilities. It will help them transport the products of their clients via the choice of the most suitable carrier. While tying with the carrier company, the strategists of the shipping company should ensure that they will have the bargaining power about the freight rates with the carrier companies. Bargaining power will give them confidence to give their clients discounts. In addition to it, a supply chain management system can go on swimmingly if shipping company can ensure that they have tied up with those carrier companies who have normal, emergency, faster transportation and delivery capabilities via different modes of their transports.
Loading & Unloading Operation: Planners should take the loading, routing, scheduling, and unloading issues very seriously. If they can guarantee that they have a definite, comprehensive and convenient dock planning, they will certainly be able to ensure that their transportation support will be best-suited for the sustenance of supply chain management service.
Supply chain management planners should go for only long-term shipping strategies. They need to look whether their plans are effective, comprehensive, and convenient. When quality service is a-must for keeping up the supply chain flow, cost-effective service is compulsory for customer satisfaction. In a word, both operational issues and freight shipping expenses are very crucial for this service.
Samer El Bizri is CEO of the Zeconomy, Inc. based in New York which provides help in supply chain management and enterprise software. Zeconomy Provides business-to-business online payment services designed to access liquidity from anywhere in supply chain.
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