5 Logistics Optimization Tips for SMBs in 2022
Logistics is a vitally important factor in the growth of small to medium-sized businesses. Being able to easily connect with consumers and deliver goods on time, whether in the B2C or B2B industry, is crucial if you want to keep them happy and coming back time and time again.
However, the unfortunate truth is that SMBs are particularly susceptible to logistical problems. Whereas large corporations are generally able to handle their logistical issues in-house, SMBs are reliant on third-party services for things such as storage, transportation, and last-mile delivery. Furthermore, a lack of supply chain visibility can lead to various issues that can eventually impact the end consumer, resulting in dissatisfaction impacting bottom-line profitability.
If you run an SMB, it’s essential that you carefully consider your logistics and delivery processes if you want to extract maximum value from your resources while delivering a high-quality service to your customers. On that note, here are five logistics optimization tips for SMBs in 2022 that you can implement across your organization.
1. Outline your objectives
As with anything in life, planning and preparation are paramount to success. However, before you even begin to put your plan in place, you should stop considering your overall objective with your logistics and delivery processes. If your company strategy is to deliver goods to the end consumer in the shortest time possible, you need to set up your logistics to make that happen. In most cases, this will mean allocating a larger percentage of your budget to transportation services, for example.
On the other hand, if your strategy offers low-cost goods, you need to find ways to minimize expenses. Let’s say you offer free delivery. In that case, how will this factor into your overall budgeting costs? Are there ways you can mitigate this expense throughout your logistics?
2. Always keep the customer in mind
Even if your company is focused on cost control, you still need to ensure that you are providing a quality service. The logistical operations you employ should all be selected to meet the wants and needs of your customers (within reason). Interestingly, a survey from Supply Chain Insights revealed that only 2% of survey respondents considered their ability to meet customer demands to be excellent. This presents a huge opportunity for you to gain a competitive advantage over your rivals through superior service. You can achieve this by offering status updates, free returns, and so on.
3. Ensure secure parcel deliveries
With the rise of eCommerce, there is now more pressure on last-mile delivery services than ever before. Low-density deliveries, outdated technology, and unpredictable elements are all factors that make things even more difficult for couriers, which often leads to problems with delivery times and the successful delivery of packages.
In addition, parcel theft is a rapidly growing crime across the USA. In fact, 210 million parcels were stolen in 2021, according to the New York Post. That equates to a staggering 64% of the population that have been victims of package theft in the past year.
With this in mind, offering a secure, last-mile delivery service to your customers can help overcome these issues. Mileberry, for example, is building a network of high-quality self-service locker smart machines that allow people to securely send and receive items. These lockers will open and close via QR codes, securing each one and its parcels flawlessly.
4. Negotiate and look for better prices
The Inbound Logistics 2020 Market Research Survey revealed that cost reduction was the biggest logistics challenge business owners faced. With this in mind, it’s vitally important that you look for ways to minimize costs, so you can take better control of your budget. For example, if you use a third-party service for storage or delivery (such as a courier), you need to start negotiating better prices. Remember, there is a lot of competition, so don’t be afraid to leverage that to your benefit.
5. Prioritize visibility
No matter what your strategy is, you need to prioritize visibility across your supply chain if you want to effectively serve your customer. A transparent supply chain means communicating and collaborating with all stakeholders along the product journey, from manufacturing to the last mile to delivery. Of course, this is not always possible; the more informed you are with the product journey, the better. This is because you will deal with problems as they arise, such as issues with shipments or customer returns. You will also be able to keep inventory low and keep lead times to a minimum, thus reducing costs and boosting customer satisfaction simultaneously.
Wrapping up
While logistics and transportation are crucial components of any SMB strategy, they are extremely difficult to get right. With an over-reliance on third-party services and rising consumer demands, you must carefully consider your strategy while putting measures in place to reduce costs while ensuring customer satisfaction. By prioritizing supply chain visibility and offering a multichannel service (such as self-service pickup), you can reduce your reliance on external operations and gain back control of your supply chain logistics. In turn, this will allow you to deliver an improved service to your customers, without increasing your expenditure.
