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Why logistics are complex (and what you can do to remedy it)
Why Logistics Are Complex (and What You Can Do to Remedy It) Logistics looks deceptively simple from the outside. A product needs to move from one place to another. Someone arranges transportation, someone prepares the shipment, and eventually the goods arrive at their destination. Simple, right? Not quite. Behind every successful delivery is an intricate choreography involving suppliers, warehouses, carriers, customs authorities, inventory systems, customers, employees, technology, weather conditions, fuel prices, regulations, and countless other variables. When everything works, the process appears almost invisible. When something goes wrong, the complexity suddenly becomes impossible to ignore. For businesses operating across multiple regions, logistics can become a labyrinthine undertaking where a minor…
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How to Deal With the Complexity of Your Logistics
Logistics becomes complicated long before it becomes visibly chaotic. A business may begin with a handful of products, a small warehouse, a few suppliers, and a relatively simple delivery network. As sales grow, however, the number of variables expands. More products are introduced. Customers become geographically dispersed. Suppliers multiply. Delivery expectations become shorter. Returns increase. Regulations evolve. Data accumulates across multiple systems. Eventually, a process that once seemed straightforward becomes an intricate web of dependencies. One delayed supplier can affect inventory. Inventory shortages can disrupt order fulfillment. Fulfillment delays can create customer-service problems. Those problems can generate emergency shipments, which increase costs and further complicate transportation planning. This is why…
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How to Deal With Complexity in the Supply Chain
Supply chains rarely become complex overnight. Complexity usually accumulates gradually as businesses expand their product portfolios, enter new markets, add suppliers, increase customer expectations, and introduce new technologies. At first, every addition appears reasonable. A new supplier offers better prices. A new product attracts customers. A new warehouse shortens delivery distances. A new sales channel creates additional revenue. Then the interactions begin. More products mean more inventory decisions. More suppliers mean more lead-time variability. More markets mean additional regulations. More warehouses mean more stock transfers. More customer promises mean more service-level requirements. Eventually, the individual pieces become interconnected to such an extent that changing one part of the system can…
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How to reduce logistics complexity
Last week we discussed in our blog about the complexity in the supply chain. On that occasion we focused on finding its origins, where it comes from and why it seems to be in constant growth. Today we want to focus on finding a solution, on seeing what methods we can use to try to reduce logistical complexity. 5 resources to reduce logistics complexity The report from the University of Michigan that we were looking at proposes a series of recommendations to deal with this seemingly endless complexity. avoid it It is not necessary to reduce what, from the beginning, does not exist. This is not to say that the…
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