What's the Role of Logistics in Transportation of Goods?

Logistics is the subset of supply chain management that defines how business commodities will move from one point to another.

Think of it as the oxygen of the supply chain—the activity besides which transportation of goods would be impossible.

Whether you want to move goods from your store or warehouse to a middleman or end consumer, proper logistical support is essential for seamless operations.

How does logistics aid in the transportation of goods?—The 6 Steps

Processing Orders

Order processing is the responsibility of the commercial department in a company. This process begins the instant a customer places an order.

For instance, if it is an eCommerce store, the order processing team starts by identifying the product from the inventory, packaging it, and setting up shipping plans.

On the other hand, if they are bulky goods, the commercial department transfers them to a warehouse until the customer completes the agreed payment for shipping to commence.

Note that order processing is exclusive of manufacturing. The commodities should be ready for distribution once the customer places the order.

Processing Orders

Once the commodities arrive at the warehouse, the next step is to determine the precise location to store it.

Warehouses have a very strategic organization because it houses thousands of packages from different clients.

Therefore, keeping everything in order goes a long way in improving efficiency and accuracy.

The department is also responsible for keeping the commodities safe conditions in the warehouse.

Poor handling of commodities, such as exposing the goods to hostile conditions or improper recording in the warehouse inventories, could result in massive losses and unnecessary inconveniences.

Material Handling

As the name suggests, material handling deals with the actual handling of the goods right from the distribution point to the end consumer.

It encompasses all the movement, storage, and protection of the goods—from manufacturing and warehousing to distribution and consumption.

Depending on the type of goods, material handling could be fully automated, semi-automated, or entirely manual.

The key objective of material handling in logistics for transportation is to help minimize the unit production cost.

Other benefits include reducing isle space, creating good working conditions, improving effective capacity, and minimizing product handling.

Inventories Control

How you manage your inventories in logistics could be the reason your business thrives or survives. In fact, it is crucial in all aspects of any business.

The strategy encompasses three main parts—organizational control, quality control, and inventory forecasting.

Organizational control implies taking charge of how every detail appears on inventories. Everything from Stock Keeping Units (SKUs) to formatting should be very legible to avoid confusion.

On the other hand, quality control ensures consistency and all figures add up correctly.

Lastly, inventory forecasting focuses on predicting future customer demand. Good prediction aids in managing supplies to avoid losses when the demand goes down.

Packaging

Before issuing the goods from the warehouse to the distribution department, they must be packed in the safest way possible.

The method of packaging depends on factors such as the mode of transport, methods of material handling to be involved along the way, available packaging materials, and the value of the of the product.

The Actual Transportation

Transportation involved getting the goods from the company’s warehouse to a dealer’s premises, or to the end consumer—if there are no dealers in between.

It is, perhaps, the most involving part of logistics because a simple mistake can easily damage the cargo.

For instance, if you are importing perishable goods, you should get customs clearance before the goods get to the border to avoid unnecessary damages.

Better yet, working with a customs clearance company or an international freight forwarder goes a long way in improving efficiency for both import and exports.

Note that the ease of transportation depends on how well your inventory and warehouse management was.

Deploying the best practices in these two minimizes common hiccups during transportation.