Optimizing Inbound & Outbound Logistics
While they might focus specifically on inbound or outbound logistics at certain times, supply chain managers ultimately aim to optimize both. To get a sense of the benefits that supply chain managers can generate by examining inbound and outbound logistics activities, let’s take a closer look.
Optimizing Inbound Logistics
By setting key performance indicators (KPIs)—like freight bill accuracy, transportation costs, lead times, and receiving times—supply chain managers can get a better handle on their inbound logistics and uncover new efficiencies. Overall, this process has the potential to:
- Shorten time to revenue by eliminating inefficiencies that increase lead time.
- Maintain stock and inventory at ideal levels, balancing inventory carrying costs with product availability.
- Increase customer satisfaction by keeping inventory in stock, which reduces order delays.
- Decrease freight costs by minimizing or eliminating emergency restocks.
To learn more about the benefits of optimizing inbound logistics (and the accompanying challenges!), check out our article: “What Is Inbound Logistics? How Does It Work?”
Optimizing Outbound Logistics
On the other side of the operation, there are also plenty of benefits for optimizing a company’s outbound logistics. By looking at KPIs like order fill rate, order accuracy, order processing time, delivery time, and customer service complaints, supply chain managers can tweak their processes to reduce waste and increase efficiencies, resulting in benefits like:
- Cost savings, often in last-mile delivery, which can be notoriously expensive.
- Faster delivery of goods, which can mean receiving revenue more quickly for companies who collect on or after delivery.
- Creating greater levels of customer satisfaction with faster, error-free deliveries.
For more on the benefits and challenges of outbound logistics, take a look at our other article: “What Is Outbound Logistics? How Does It Work?”