5 Benefits of using Logistics Correctly in SCM

Why logistics is so important for supply chains

Logistics is an important part of supply chains because it manages and tracks the people and resources needed to store and transport goods and services. Logistics ensures that materials and products move reliably on time and within budget.

Specific aspects of logistics that support supply chains include:

• Deliver the right products at the right time.
• Reduce costs and improve efficiency.
• Help retain customers and increase loyalty.
• Provide a unique value proposition for certain works.
• Provide a means of delivery of goods from the most cost-effective site of production to the customer’s site.

5 important benefits when using logistics correctly in SCM

1 Faster delivery.

With improved supply chain logistics capabilities, small businesses can accomplish reliable and timely deliveries. Faster delivery speeds not only create a competitive advantage but also enhance customer service experiences. Like Amazon, it offers its members one-click ordering options and two-day shipping speeds.

2 Increased accuracy.

IT tools and supply chain management software allow third-party organizations throughout the supply chain to verify the status of the product before it reaches the end customer. Customers can even use supply chain network tools to track where their final product is currently in the supply chain with the expectation of its arrival.

3 Enhanced customer service.

The ability to produce a strategy that meets and exceeds the needs of potential and existing customers is highly dependent on effective logistics and supply chain management. Even after the implementation of the strategy, companies should always look for ways to increase and improve customer service capabilities and logistics to indicate customer demand expectations and customer feedback to develop and implement best practices.

4 Business development.

Supply chain logistics and supply chain management best practices can be updated to meet extended customer demands and increase sales. Especially for companies that already use a global supply chain or want to expand from a local market to a global market, you will need to add more additional third-party providers to the supply chain than ever before.

5 Resource optimization.

Efficient logistics reduce supply chain management costs and as a result, profit margins increase. For example, outsourcing responsibilities in inventory management and final product delivery can increase efficiency while reducing costs incurred.