Logistics Is Important

Logistics are part of the day to day headache of every business person, manager or entrepreneur. When products, equipment and raw materials are procured, the logistics process ensures that they get to the business in time and in good shape. On the other hand, logistical processes are involved in ensuring distribution of products and services to clients. But what type of businesses require logistics companies and why is it important to have a robust and efficient process in place for every business?

Extra information about logistics companies

Importance of an efficient logistics system

A robust, efficient and effective logistics system is important in retaining financial profitability of all organisations. Through efficient logistics the cost of raw materials and the cost of delivery are kept low while the prices of products can be optimised. Efficiency in logistics also helps in enhancing the brand or company image to clients and other stakeholders. Such a brand is highly valued and preferred and this makes it easier to gain clients, raise funds, get high calibre employees as well as catch the eye of other stakeholders.

Logistics can also be part of the competitive edge of a company in comparison to its competitors. This is especially important for businesses that have a global audience since it ensures that the company can expand with ease to different markets. Ultimately, clients will refer your brand to their friends when they are happy with your brand. When referrals keep pouring in, the marketing and advertising budget may decrease over time to allow for organic growth of the company. However, the company can also use this as an opportunity to maximise on the marketing and sales budget to promote the success of the business.

Businesses that rely on logistics for success

Fast food joints and restaurants that deliver food to their clients require an efficient and fast delivery process to ensure that the food gets to the clients as soon as possible. In a perfectly competitive world, delays in delivery, contamination of food during the delivery process as well as confusion in customer orders can give your competitors a competitive edge. It is therefore imperative for any fast food joint or restaurant to ensure that their logistics are high class which also ensures that the raw materials required to make the food are delivered to the restaurant while they are still fresh.

The e-commerce industry also requires an extremely efficient logistics company as a partner in order to ensure that the clients receive what they ordered within the indicated tie duration. Remember that in this era where fraudsters are all around us, longer delivery periods may lead to being branded as one. Once the rumours begin, they spread fast and furious and this can bring down a well-established brand.

The agricultural and horticultural sectors, whose produce needs to be delivered to stores and clients fresh not only need great, efficient logistics system but also a viable back up logistics plan. This is especially important because most agricultural and horticultural produce requires custom made trucks with refrigeration or temperature control abilities to keep the produce fresh. In such a case, a simple breakdown in the process not only wastes precious food but it also leads to extreme financial losses among the farmers and others in the delivery channel.

KFC Runs out of chicken

This is a great example of what inefficiencies in the logistical process can do to a business. In early 2018, KFC in the UK had to close two thirds of their stores for a couple of days. Operational issues by their new logistics partner DHL was the main reason behind the closure. While they were graceful enough to admit the problem and explain to their clients the reason behind the closure, they also suffered financial loss and their brand image may have suffered due to negative speculations from clients and market experts.