If a logistics business starts to struggle, it looks to save costs by cutting corners and to increase revenues by raising rates, focusing on its most profitable business and reducing marginal business. The first you hear about it is when deliveries fail to appear or a Dear John letter drops on your desk.
These potential crises and the general economic malaise have created a shift in the way logistics is viewed in the food and drink industry and in the decision-making process of manufacturers reviewing their supply chain operation. While cost is still a key factor, the reliability, flexibility and quality of service provided have overtaken it in terms of importance. Manufacturers are also keen to see evidence that their logistics provider is well resourced and well supported, that it has a strong and stable customer base and that it has well-established, strong relationships with retailers.
In short, the final decision on supply chain partner is moving away from the finance department and towards the logistics, sales and marketing functions of a business. Manufacturers are beginning to realise that a realistic partnership with a reliable supply chain operator can reap benefits that far outweigh the required investment.
Despite the present difficulties, there are still profits to be made, competitors to be elbowed out and new business won. The current situation reinforces the economy-of-scale benefits of working with a reliable third party specialist. Manufacturers now need a solution that not only fulfils the demanding and diverse requirements of a variety of retailers, but which also adds genuine, measurable value to their own business. This requires the provision of accurate data that provides them with full operational transparency and the opportunity to manage their supply chain, administration, production and sales functions more efficiently.
By understanding how the right logistics partner can add value across an entire business and by selecting a business with a long, successful track record, suppliers are ensuring the integrity of today’s supply chain – and tomorrow’s. Maybe the horse won’t bolt after all.
Dale Fiddy is sales and marketing director at Culina Logistics.
These potential crises and the general economic malaise have created a shift in the way logistics is viewed in the food and drink industry and in the decision-making process of manufacturers reviewing their supply chain operation. While cost is still a key factor, the reliability, flexibility and quality of service provided have overtaken it in terms of importance. Manufacturers are also keen to see evidence that their logistics provider is well resourced and well supported, that it has a strong and stable customer base and that it has well-established, strong relationships with retailers.
In short, the final decision on supply chain partner is moving away from the finance department and towards the logistics, sales and marketing functions of a business. Manufacturers are beginning to realise that a realistic partnership with a reliable supply chain operator can reap benefits that far outweigh the required investment.
Despite the present difficulties, there are still profits to be made, competitors to be elbowed out and new business won. The current situation reinforces the economy-of-scale benefits of working with a reliable third party specialist. Manufacturers now need a solution that not only fulfils the demanding and diverse requirements of a variety of retailers, but which also adds genuine, measurable value to their own business. This requires the provision of accurate data that provides them with full operational transparency and the opportunity to manage their supply chain, administration, production and sales functions more efficiently.
By understanding how the right logistics partner can add value across an entire business and by selecting a business with a long, successful track record, suppliers are ensuring the integrity of today’s supply chain – and tomorrow’s. Maybe the horse won’t bolt after all.
Dale Fiddy is sales and marketing director at Culina Logistics.
No comments yet