Companies of all sizes are becoming increasingly aware that details logistics are a critical part of their competitive positioning. Customers are more demanding and markets less forgiving when it comes to all aspects of the logistics chain across all industries. Because of these factors, the selection of the right warehousing and distribution center solution must be a top-level management priority.
Taking Nothing for Granted
Throughout the late 20th century, warehousing and distribution centers were considered commodities and relegated to lower-level managers. However, with Â todayâ€™s hyper-competitive environment, a bright spotlight is placed on these and other components of the logistics chain. In fact, the growth in 3PL is one indication of how many smaller firms are accessing state-of-the art resources and facilities for their requirements.
The huge investments made in smarter warehouse design and intelligent management of distribution centers are beyond the reach of most smaller companies. This makes it essential for many of these companies to take advantage of the economies of scale offered by such advanced installations. In a sense, this is analogous to these smaller companies outsourcing IT needs to massive data centers in the cloud.
Matching Needs with Resources
All of these new dynamics make the process of selecting warehousing and distribution centers more complex. Some companies with moderate needs can continue to find value in the traditional options, while many more find the full 3PL route the most advantageous.
There are a number of factors to consider in making this vital decision, including:
- Customer expectations. If a company is competing in a market space requiring overnight deliveries and free shipping, this will be a driving factor in any logistics strategy that is acceptable
- Scalability and seasonality. While two different issues, the new market environment requires warehousing and distribution center capabilities that support rapid growth and significant shifts in seasonal demand. Most small to mid-size companies find this one of their largest logistics concerns.
- Physical requirements. Evaluating any warehousing options involves a long list of items that include such things as:
- Climate control
- Racking systems
- Number of docks and doors
- Handling equipment availability
This extensive checklist of criteria will provide a basic apples-to-apples comparison for warehousing options.
- Software and IT capabilities. Again, this one issue covers a wide multitude of concerns, from real-time inventory management to reporting (both internal and to customers) to 24/7 web-enabled access. These features are in addition to the now expected e-commerce and shipping integration features.
- Management culture. When choosing a warehousing and distribution solution, most companies today are concerned about their ability to work with and communicate with the on-site individuals responsible for their orders and inventory. Having real-time and direct control can only be provided when the logistics company has built a culture that delivers in this area.
Personalizing Your Solution
The logistics equation is a complex and rapidly evolving management challenge. If you are responsible for managing the selection of and/or managing the warehouseÂ and distribution center aspect of your companyâ€™s logistics chain, you will benefit by seeking impartial third-party assistance with the process.
Constant monitoring and evaluation is required for the many advances in technology for warehouses and material handling systems. Likewise, the logistics space now includes such specialties as WMS, EDI, JIT and ERP â€“ all of which have their own role in making the right decisions for your specific logistics requirements.
The new world of logistics presents exciting opportunities for competitive differentiation along with new competitive challenges. These realities reinforce the importance of careful consideration and evaluation of your companyâ€™s warehousing and distribution center strategies.
Working with TVI Logistics
TVI Logistics has been in business for over 20 years and we specialize in all aspects of logistics and freight forwarding – all the services you need to support your business and reduce your time to market. We live and breathe logistics, and we’re happy to discuss options and strategies for operations or enterprises of any size.
If you want to learn more about third-party logistics or ways to optimize your logistics activities, we publish a newsletter that you can sign up for on our homepage. We’d love to hear from you to find out more about how we can help you power your business into a progressive and successful future, so contact us today to start discussing your options.