In logistics operation, cost reduction is
one of the major themes, along with such as efficient use of space and shorten
time loss. We introduce the 10 points
for reducing logistics costs.
1. Aiming
at the one-stop logistics
First, let’s think about the total ideal image of logistics. As much as possible, you should be aware of the one-stop flow mechanism which never stop. Thereby, you could reduce the stock in minimum volume and also you could reduce the logistics costs.
First, let’s think about the total ideal image of logistics. As much as possible, you should be aware of the one-stop flow mechanism which never stop. Thereby, you could reduce the stock in minimum volume and also you could reduce the logistics costs.
2. The
optimal supply chain management
It is important to think about the perspective of the supply chain management(SCM) which is totally considered from the upper flow’s creator to the consumer. By using SCM for managing the appropriate volume of stock, the effect such as reduction of lead time and inventory could be expected.
It is important to think about the perspective of the supply chain management(SCM) which is totally considered from the upper flow’s creator to the consumer. By using SCM for managing the appropriate volume of stock, the effect such as reduction of lead time and inventory could be expected.
3. Looking
for the bottleneck
Let's find out the bottlenecks that exist somewhere. It often happens that bottlenecks are creating extra costs. Being aware of the logistics "visualization", will help in the discovery of the bottlenecks.
Let's find out the bottlenecks that exist somewhere. It often happens that bottlenecks are creating extra costs. Being aware of the logistics "visualization", will help in the discovery of the bottlenecks.
4. Reconfirmation
of transportation costs
Let’s double-check the fare of air or ocean transports which are connecting Japan to foreign countries. By rising fuel costs in recent years, the surcharges sometimes become unexpected price. In the ocean transports between China, you should be careful that there are some special fuel surcharges imposed.
Let’s double-check the fare of air or ocean transports which are connecting Japan to foreign countries. By rising fuel costs in recent years, the surcharges sometimes become unexpected price. In the ocean transports between China, you should be careful that there are some special fuel surcharges imposed.
5. Thorough
inventory management
In logistics operation, everywhere in factories, warehouses and stores, to have excess stock thus raises the storage costs. In order to prevent this, it should be aware of the inventory management with an appropriate production and “visualization”.
In logistics operation, everywhere in factories, warehouses and stores, to have excess stock thus raises the storage costs. In order to prevent this, it should be aware of the inventory management with an appropriate production and “visualization”.
6. Readjustment
of staffing
Using automation system is sometimes more effective than using human efforts in logistics. For example, in warehouse operations, it becomes possible to automatically measure the achievement of business by using warehouse management systems. It also make it possible to apply the staffs who became free by using systems to the other operations.
Using automation system is sometimes more effective than using human efforts in logistics. For example, in warehouse operations, it becomes possible to automatically measure the achievement of business by using warehouse management systems. It also make it possible to apply the staffs who became free by using systems to the other operations.
7. Re-examination
of transportation method
There are several means to re-examination of the transportation method. In Japan, there are some transportation methods such as air or ocean for international and truck or rail for domestic, and each methods have both merits and demerits. Although reducing costs and transportation speed are opposite relationship, it would be good to re-examine whether the speed is really needed or not. And in some cases, the cheapest way of transport should be chosen even if the speed falls.
There are several means to re-examination of the transportation method. In Japan, there are some transportation methods such as air or ocean for international and truck or rail for domestic, and each methods have both merits and demerits. Although reducing costs and transportation speed are opposite relationship, it would be good to re-examine whether the speed is really needed or not. And in some cases, the cheapest way of transport should be chosen even if the speed falls.
8. Centralization
of information management
To centralize not only logistics but also information of related operations will be able to prevent errors occurred by distributing information. And then, status of each process can be grasped in real time, and it becomes to reduce the cost of logistics management.
To centralize not only logistics but also information of related operations will be able to prevent errors occurred by distributing information. And then, status of each process can be grasped in real time, and it becomes to reduce the cost of logistics management.
9. Reconsider
of less-than-carload lot cargo (LCL)
The cargo of LCL is convenient, but the cost is more expensive than the large cargo. Especially in the logistics process for container cargo, if it is possible to use warehouses effectively, it makes a cargo treat as a large cargo with vanning or devanning there. It would be good to reconsider to use which strategy should be chosen.
The cargo of LCL is convenient, but the cost is more expensive than the large cargo. Especially in the logistics process for container cargo, if it is possible to use warehouses effectively, it makes a cargo treat as a large cargo with vanning or devanning there. It would be good to reconsider to use which strategy should be chosen.
10.
Re-examined outsourcing
Outsourcing has been adopted continuously in logistics managements. You should try to re-examine your outsourcing in terms of cost if you are already adopting it. You should be better to figure out the total running costs up to continuous supports.
Outsourcing has been adopted continuously in logistics managements. You should try to re-examine your outsourcing in terms of cost if you are already adopting it. You should be better to figure out the total running costs up to continuous supports.
The point is ”Visualization”
Now, although we have been took up many
cases such as inventory management, warehouse operations, transportation method
and transportation fee, the most important point is to make all of them “Visualization”. Why don’t you reconsider some parts where
become black boxes?
References：
10 tips for reducing supply
chain logistics costs
3PL Capability is Key to
Logistics Cost Reduction
International Shipping
Companies - Tips to Reduce the Cost of Logistics
CUTTING COSTS FROM YOUR LOGISTICS BUDGET: 10 TIPS
Tips for Reducing
Transportation Costs
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