Sarat Chandra IAS Academy – UPSC Mains Answers

Transport Intelligence Logistics & Supply Chain Market Research

The order fulfilment time is one of the most important factors encouraging to make purchases over the internet. This time runs from the moment the seller confirms the order until the moment the goods are received by the customer. It is influenced by several processes –picking, packing, shipping and delivering. The last one is the longest and largely independent of the seller, as it is mostly performed by external logistics companies. Thus, the customer relies on the seller’s promise of the order fulfilment time, and the seller, in turn, on his/her subcontractor. If this time is extended, it may reduce the subjectively perceived benefits of online shopping.

Return handling after delivery includes several steps, such as inspection of the goods, restocking, repicking and repacking processes. Return handling fees normally consist of operational processing costs to restock the returned items. Shipping costs vary for business uss careers customers depending on whether they are determined individually for each client or via fixed framework agreements. The packaging materials used for fulfilled orders are customizable and could help you generate more future sales due to a greater customer experience.

Basic Components of Logistics Cost

Regarding the packaging material, standard material can be supplied by the 3PL provider, which usually costs between 0.20 to 0.50 EUR per box. When working with a 3PL, however, the packing process is highly customizable. If you want to create a great customer experience that includes your branding materials, 3PLs can also use special packing materials such as specific wrapping paper or stickers, personalized marketing flyers and so on. Clearly, this would lead to higher fulfillment costs for packaging materials as the indicated prices from above. Ask about the shipping methods they use, the service levels, and any pricing/discount information they’ll give once your inventory increases. If you transport freight globally, some include brokerage fees; others include import/export taxes and duties in their costs. When choosing a 3PL warehouse, determine how many distribution centers you’ll have access to.

express purchases in the field of logistics

The transmittal time includes transferring the order request from the origin to the entry of the order for further processing. Order entry may be handled manually such as physically carrying the order or electronically via toll-free number, satellite communication or via the internet. The manual processing is slow but inexpensive, while the electronic methods are most reliable, accurate and fast but expensive. Empower customers by providing information regarding the purchased products so that they can express and communicate better their expectations. To elaborate on what Oxford said, we’ll take a peek into the field of supply chain management . The best way to reduce costs and thereby increase profit is through regular review of the company’s logistics strategies and taking the necessary actions to address drawbacks. A dynamic management that always encourages innovations and reorganizes operations to meet requirements helps to drive up the revenue.

6.1. Two-point method

“Go beyond the traditional metrics of capital, service and cost and determine some aggressive key performance indicators that are necessary for helping your supply chain improve. Sit down with your executive team and really brainstorm what metrics matter to your business. When it comes time to fulfill the order, products uss jobs from inventory must be picked from their assigned inventory location, and inventory counts are updated to ensure stock levels are accurate. Reverse logistics — or the processing of customer returns and exchanges — also qualifies as an inbound logistics process, as inventory is technically coming into the warehouse.

  • Only later, sometimes too late, they find out the product or service did not meet the requirements and the vendor did not clearly understand.
  • Since 3PLs are able to negotiate preferred shipping rates, the cost of shipping is typically lower.
  • Outbound logistics are extremely collaborative in nature, so strengthening relationships with the people and parties that your supply chain relies on will only improve it.
  • While they are similar in nature and both involve the transportation of products across various distribution channels, inbound logistics deals with supply and outbound logistics fulfills demand.
  • Kuehne + Nagel Inc. began as a forwarding commission agency for cotton and other combined freight in Bremen, Germany, in 1890.

Constant monitoring of the organization’s performance and taking pre-emptive measures to prevent aberrations and arrest negative trends can avoid losses. Improved customer services and varied value-added services help in customer retention and increased goodwill of the organization. As we can see here, it includes several parties such as the manufacturer, transport and shipping companies, clearing and forwarding agents, the warehouse operator, and a host of other players.

Leave a Comment

Your email address will not be published.