6 Important Logistics Management Tips for Small Business Owners

Logistics management tips for SMBs

It may start like a dream, but to many business owners, it can quickly turn into a nightmare. Despite what they say, there is more to it than “hustling” and working long hours. If you want your business to succeed and to sell your product, you need to pay attention to a lot of things. One of them is certainly logistics. Here are 6 logistics management tips that will help your small business thrive and keep your customers happy.

1. Set Your Objectives

Okay, this one is easy, right? The objective of logistics is to move the product from point A to point B. Easy. Except there is more to it. Your logistics objectives first need to align perfectly with your business objectives. Second, you need to determine what is your primary target. Do you want to have cheap delivery or fast delivery?

If you are going for cheap delivery, you will probably have to find some non-essentials that you can remove from the equation. On the other hand, if you’re aiming to provide fast delivery, then your transportation and shipping costs are likely to increase. In the end, you need to find that perfect balance between these two and find out what the customer wants.

2. What’s the Plan?

Once you know what your logistics objectives are and they are aligned with your business and marketing objectives, it’s time to work out a plan. Now, keep in mind that you can’t plan only based on your expectations. That will be just one thing that you will need to look at, but there will be different areas that will demand your attention as well.

You should have a plan for full shipping ready in advance, of course, but also don’t rely on just one plan as it might easily fail you. Always set up contingency plans in case things don’t work out as you intended. For instance, if there are delays, the truck breaks down or has to take another route to reach the customer.

3. Keep an Eye on the Costs

Former Secretary of Treasury of Great Britain, William Lowndes (1652-1724) once said: “Watch the pence and the pounds will take care of themselves”. The quote was latter attributed to Benjamin Franklin (falsely), but whoever first said it was right to the point.

You should know how much each element of the logistic process costs you, and not just focus on the major ones like shipping or packaging. That way, when you know where each dollar, euro or pound is going, it is much easier to find things where you can save on costs and keep your cashflow in check.

4. Track Every Inbound Supply

Don’t just track the shipment. Track all inbound supplies that you have. For example, if you are selling furniture, you need to make sure that you have all the needed materials to make it. If just one piece is missing, you can’t make that desk or chair.

Knowing when your material will arrive makes it much easier for the workers to assemble the final product and start delivering it to the end user.

5. Improve Your Customer Service

You can never have a too good customer service. Always work on improving your customer’s satisfaction. One sure way of doing this is to keep them informed about their order. That means from start to finish. Hopefully, that finish is at their doorstep, but if there are any delays or other problems, you need to keep them informed about those as well.

The customer will much more appreciate your honesty and your commitment to rectify it (and if need be, you can always give them something extra as an apology) than if you keep your mouth shut and keep them in the dark about the shipment.

6. Try 3rd Party Logistics Companies

As an SMB you might not have the luxury of having your own logistics. That’s perfectly fine as there are plenty of 3rd party logistics companies or 3PLs out there. Don’t go for the first one you find though, or the cheapest one either. Get at least 3-4 quotes from different 3PLs and compare what they offer.

Even then, don’t settle for the first price. Always negotiate to get the best deal possible for your company.

Conclusion

Logistics is a crucial element in the supply chain and your business operations as a whole and it can make or break it. These 6 logistics management tips can help you make sure things run smoothly.

Do you have any thoughts or questions about the article? Let me know in the comments below and don’t forget to sign up for Purchase Order Plus.

Leave a Reply