By Gary Whittle, LinQ Alliance.
The logistics and transport industry has felt the brunt of the credit crunch with a continuing downturn in manufacturing and retail as well as a tailing off in the importation and exportation of goods. As company failures in the sector increase, the name of the game is to stay afloat until the recession abates and a more stable outlook prevails.
Until recently, medium sized logistics companies worked independently relying on their own commercial acumen to ensure a steady flow of orders. Now, as demand slows, sharing information and facilities is proving a lifeline for companies struggling to compete in a reducing marketplace.
The formation of companies, such as LinQ Alliance, has totally altered the approach of the medium sized logistic company to winning new and retaining existing business. As LinQ Alliance has clearly illustrated, individual businesses can successfully form themselves into a reputable 3PL company with its own board of directors, premises and staff. The concept of individual businesses holding operational meetings and sharing information and resources would have been impossible to imagine only a few years ago. Now, it is proving a productive and positive alliance.
Collaboration between medium sized companies not only guarantees the security of the supply chain but also ensures the customer reaps the rewards of optimised fleet efficiency. Ensuring that vehicles are used to their full potential through efficient planning and real-time visibility of fleet activity can make a significant difference to the bottom line.
Linking operations through the effective use of IT, such as transport management systems, provide the planning and monitoring tools to ensure a vehicle’s efficiency, both in terms of load and time. Such systems give customers greater control of stock levels and transactions and can provide customers with daily, weekly or monthly reports to provide them with stock levels and movement figures over the Internet. Detailed, real-time, data makes it much easier for companies to read trends, which is especially important during a recession.
In a recent pole, 58% of 350 companies interviewed stated that logistics would be a main source of cost saving during 2009 and 40% saw outsourcing logistics as a means of cutting costs in the recession. 3PL organisations that can offer competitive rates, innovative solutions and value-added services are well placed to take advantage of these cost-cutting measures.
Organisations shouldn’t see the recession as a short-term situation, but instead as a complete change in how things are done. 3PL providers, such as LinQ Alliance, are placing added importance on cost reduction in their efforts to serve customers in these tough economic times. Companies that make headway with strategic supply chain improvements will be better positioned to pull away from competition when the economic tide begins to rise. Ends
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