Logistics: how to choose the best service providers?
What are the elements to watch out for when choosing your logistics providers? Here is a guide to making the right choice and saving money.
With digitalization and in order to reduce costs, the logistics function has been strongly outsourced. Despite the pressure generated by the desire to save time, it is important to choose your logistics providers carefully . A good logistics provider will promote the development of your business. In addition, there are more and more logistics providers in the face of growing demand, which makes the choice of outsourcing more convoluted.
The role of external logistics providers
The use of external logistics service providers allows significant savings to be made on expenditure items such as inventory management, costs Truck Dispatch Services In Oregon generated by the storage of goods, their packaging, the last mile and the logistics costs generated by the delivery to the customer.
By outsourcing logistics, the specialist provider can offer more cost-effective alternatives. In addition, the vast network of external service providers can help you benefit from discounts and preferential rates, while monitoring operations.
Logistics specifications: at the heart of your strategy
Before outsourcing your logistics, you should first assess your needs. Here are some questions to guide you in your choice to find the right logistics partner:
- What are your needs ? Evaluate your scope of delivery. Is it national, international, in the DOM-TOM or DROM-COM?
- What type are your goods? Are they packaged, bulky, loose…?
- What is the volume of your orders?
- What is your customer segmentation? Do you have private (B2C), professional (B2B) customers?
- Why write a logistics specification?
Writing your specifications allows you to determine your specific needs in advance. These needs are assessed in terms of quality requirements, your objectives and your performance. Once these specific requirements have been determined, the logistics providers will be able to establish a quote adapted to your expectations. Thus, your future logistics provider will have all the key elements to draw up an estimate that meets your needs . Your logistician will be able to offer you his services according to your product range or your expectations, for example:
- high-end products
- sensitive or fragile goods
- bulky products, heavy loads
- finishing of manufactured products
- logistics flows according to seasonality
- customer service and after-sales service
Thus, your logistics estimate for transport will detail the organization and the human resources needs to carry out your projects.
Take care to compare the offers of logistics providers
To develop a tailored and profitable outsourcing strategy, also consider growth plans. Once the specifications have been drawn up, you will be able to determine which service provider best suits your needs and what the associated costs will be . In addition, this will allow you to plan upstream flows of goods, as well as transit times.
Assessing your logistics network is also important, so you can determine if warehouse centers are available in your logistics network. The location of your storage space should depend on the characteristics of the products and their durability. Your external distribution network must be positioned on strategic sites and guarantee a good implementation of the distribution network.
Achieve economies of scale on pre-shipment
In the supply chain, the role of the goods distribution center comes after production. Your storage center offers the possibility of placing your buffer stocks, that is to say your safety production kept for replenishment, close to your distribution areas before delivery.
By relying on a strategy of massification of your logistics organizations, you will be able to group your goods in order to ship them in batches, and thus achieve significant economies of scale. To rationalize distribution costs, it is advisable to use the barycentre method.
The barycentre method in logistics
The barycenter method is a very widespread calculation in the logistics sector. This method aims to choose the right geographical location, which will contribute to the success of your project. For this, the barycenter (also called center of gravity) is a concept of physics which calculates an average of the coordinates.
This average can be used in Excel, for example, to assign each point abscissa and ordinate coordinates, then a weight (for example the number of goods delivered). The calculation of these weighted coordinates then makes it possible to calculate the ideal theoretical location to make your decision.
The transport plan and massification
TIMOCOM helps you group your goods together to optimize your transport plan . By using the massification strategy, the goods of several producers can be delivered to a single logistics platform.
This method is also appreciated, because it allows the goods to pass through cross-docking , that is to say from the arrival quays to the departure quays, without having to go through the storage phase of the products in the warehouse. As a general rule, the consolidation and massification of goods are managed by external service providers.
The location of distribution centers and the choice of service providers
On European soil, the free trade agreement gives companies the possibility of producing their goods in the countries of Eastern Europe, where labor is less expensive. This is why some logistics providers opt for a single distribution center, which connects production sites with consumer markets with higher purchasing power.
However, storage standards must be taken into account, as they vary between different European countries, especially for perishable goods and dangerous goods.
Traceability depends on the power of the logistician’s information system
Once you have defined your scope of delivery, drawn up your specifications and assessed your needs for optimal storage, other criteria must be taken into account when choosing your logistics service providers. The power of the information system is essential, because a powerful system will allow you to monitor the traceability of goods.
The reputation and seniority of providers also plays an important role. On the TIMOCOM platform, the profiles of the listed business partners are checked. In addition, access to the Smart Logistics System is secured by downloading a personal security code called Login. Our Business Profile category brings together over 45,000 vetted providers from across Europe to help develop new business opportunities.
The choice of the best transport providers, a sine qua non of long-term optimization
The search for suitable business partners is carried out using a real-time freight exchange . For this, trust TIMOCOM, the market leader in freight and vehicle exchanges in Europe. Our modern system makes it possible to select freight offers safely and to discover a detailed overview of the offer.