We live in challenging times that require supply chains to be agile and respond fast to changes in supply and demand. On the B2C and B2B sides, customers demand higher standards than before. This requires a razor-sharp focus, but can you be focused on everything? We think not. We believe companies should focus on their core business activities.
These core activities are activities like production, quality control, research & development, marketing, and sales for manufacturing companies. An increasing number of companies don’t just outsource their inbound or outbound logistics flows, but also their factory or production logistics.
Reasons to Outsource Your Factory Logistics
Inventory and Availability
Factory Logistics is more than just your inbound and outbound flow of goods. Production lines need to run without hiccups. Availability of all necessary parts and raw materials is essential. And don’t forget the consumables: they too can stop a production line if the wrong item runs out.
Suppose you leave the availability of the correct item at the right location at the right time and tight control of inventory levels to a logistics service provider. In that case, your operators can focus on what they do best: ensuring the production facility runs like a charm, and the quality of the product is high.
Advance Data Analytics Capabilities
Did you know there are significant potential savings possible for your inventory? Using our powerful and advanced data analytics capabilities, companies can save costs and improve the efficiency of their operations by improving the way they keep inventory. Analyzing historical data and running various scenarios, our data analytics team can determine which parts need to be on hand, how many of them you need, and where you can best store them. This means your inventory can be lean without running out of essential SKUs.
People and Equipment
Finding the right people can be a challenge, especially if you are looking for logistics personnel. If you outsource your logistics to a logistics service provider, they take that problem off your hand. It can get even more complicated if you have seasonability or otherwise fluctuating for people. There are several advantages a logistics service provider has, which you may not. Logistics service providers run multiple logistics operations, most with fluctuating demand. A logistics service provider works with a flexible pool of people and has good contracts with temp agencies. They can also leverage operations, shifting people from one relatively quiet operation to another operation with a spike in demand.
There’s an added benefit when people work in multiple operations. They take the knowledge and experience with them from one operation to the next, which means you benefit from best practices in other operations.
The same goes for material handling equipment. If you outsource the management of your material handling equipment, you no longer have to worry about having the right equipment at the right time.
In essence, outsourcing allows you to make a considerable part of your costs variable, while at the same time the management of people and equipment is done by specialists. You can focus on the key areas of your operation that add the most value.
We have a continuous improvement program in place at Ahlers, or maybe continuous improvement culture is a better description. Our people are always looking for potential improvements in all processes involved. We allow them to suggest improvements if they see them and implement them. Because of this culture, we can deliver a better service to our customers every day.
The Key Benefits of Outsourcing Your Factory Logistics
- Focus on core activities
- Raw materials and parts where you need them when you need them
- Potential cost savings and improved efficiency of your inventory
- No worries about human resource planning of logistics workers
- Continuous improvement of your logistics processes
Didier Duponselle is Business Unit Director at Ahlers. Ahlers provides state-of-the-art logistics support in sustainable supply chain management, warehousing, projects & machinery logistics, secured transport, trade logistics, after-sales services, and data analytics. Their extensive experience and knowledge of local markets make Ahlers your ideal partner for business in China, Russia or the CIS countries.
Photo by carlos aranda on Unsplash
This blogpost is sponsored by Ahlers