When we talk about logistics, there are two aspects. There are inbound and outbound logistics logistics. Inbound logistics includes everything from the purchase of raw materials to manufacture the surface of goods is connected outbound logistics supply and distribution of finished goods to customers and clients.
There are four major parts of the logistics and they are purchasing or procurement, transport, handling and storage of goods.Here are some tips to save on logistics costs in each of these areas.
Procurement:
If there is to buy raw materials, a company should always look for more suppliers, the favorable conditions of the tender offer can be. If necessary, the raw materials are imported. However, care should be taken to change the supplier is not too often. Instead, the person responsible for the procurement should have good negotiating skills.
In addition, it always helps to know the exact cost of,Purchasing an item. That means the cost of freight, customs, brokerage and costs associated with the inventory. It is only after all these costs, a company can compare the prices of the two providers and then choose the best solution.
Sometimes, working with suppliers who can supply just in time to help the company and the inventory in the purchase, it can reduce the storage costs involved.
A company should also think the use of cheaper substitutes, if possible, rather thanfor ever by high raw material costs.
Transportation:
It is always prudent financial planning, the mode of transportation on the basis of quantity and quality of the goods will be delivered to choose. Whether you use air, water, rail or road, everyone has its own advantages and disadvantages, and you should know 'basis. Choosing the right mode of transportation can help reduce costs and damage to property. Moreover, it may also reduce the in-transit and stocks. This is particularlytrue if the goods are transported by road. When the shortest route is selected, it will save much time.
Another way to reduce transport costs, is brought together by the freight consolidation where smaller quantities of goods to make larger quantities, and only then will they be transported.
Cover:
Sometimes when a company requires supplies or raw materials urgently, it ends up to ask the seller to the entire shipment via express service to send too. This can be veryexpensive for the company. However, these unnecessary costs can be avoided by a little calculation and planning, since they give the amount of urgently needed. Then just what is required to be sent be sent by express service, while the other is of normal service. In trade, the company can reduce its costs dramatically.
Inventory:
A business, it can reduce capital costs by ensuring that there is a balance between supply and demand. It is important toa good inventory management system are such that excess inventory is not established.
It makes sense, in no particular order, since many vendors give reduced prices to those commands. This way, you may also have set aside for emergencies such as fire, theft, accident or natural disaster.
Have lesser storage places on the demand. In this way a corporate risk pools and reduces the overall cost of implementing inventory.
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