Today more than ever, it is important to have a highly successful logistics process. For small and medium-sized businesses a digitized logistics system can be a strong advantage in a competitive marketplace. In a 2017 article, Forbes advocated for digitization stating “A small number of companies (9%), the progressives — that is, companies with the highest levels of supply chain digitization maturity — are already moving ahead of the pack in terms of supply chain digitization and reaping tangible rewards. Others need to catch up or risk falling further behind.”
With the post-covid supply chain costs and a growing e-commerce industry, the move to digital logistics is even more essential. At first consideration the process of switching to a more digitized process can feel overwhelming. “What does it mean to integrate digital logistics? How would it help my bottom line? And where do I begin?” are likely the first questions that arise. In this article we will discuss all these questions and give the proven strategies for a successful digital integration into your business’ logistics.
What is digital transformation in logistics?
Digitizing your logistics processes simply means incorporating any automation or technology to improve the processes related to the movement of your business’ goods. Areas optimal for digitization are processes in which repetitive manual effort or where pen and paper is involved. Common domains include: inventory, transportation, or warehouse management, supply chain forecasting and analytics, and support for customer relationships.
What are the benefits of digitizing logistics operations?
There are many tangible advantages of digitizing your business’ logistics. From customer orders, warehousing, shipping, and DTC delivery, digitization can offer better observability and streamlined services which will all ultimately help your bottom line. Let’s break down how digitization can help.
-Customer relationships: Having a digital interface for customers or your customer service staff to use which has the most up-to-date order or return statuses will give the best experience and help build long-term relationships and trust.
-Operational processes: Tools like virtual warehousing, batch printing, and digitally enhanced pick and pack will allow your warehouse to work more efficiently and speed up operations.
-Transportation performance: Digital logistics creates significantly more visibility into elements of transportation. Businesses can receive real-time information making gaps and redundancies easier to identify and address.
-Data analytics: Decision-making, visualizations, predictions, and forecasting all can be utilized with digital logistics software. AI and utilizable data sets will allow companies to make the best decisions for current and future operations.
How do you digitize a supply chain?
Now that we’ve looked at what the digitalization process is and how it can help your business, let’s begin to discuss how to take your business’ logistics into the digital age. There are three main steps of this process; assess your business’ needs, choose the right solution, and implement digital solutions.
Step 1: Assess your business’ needs. The first step to digitizing your logistics processes is identifying pain points and recognizing where digital solutions are going to have the best impact.
Pain points are the parts of your logistical process that are not optimal. For small and medium-sized companies this list often includes unexpected shipping costs, rate increases, low or lacking inventory visibility, and challenges keeping up with e-commerce transactions. Identifying pain points in your existing logistics processes allows you to identify which digital solutions will be the best fit for your business.
In addition to recognizing pain points, finding the right balance between tech and humans is vital to finding the right digital solution. Areas that your employees will likely be a better fit than a digital platform might include communicating directly with customers and 3PLs, working with carriers, and building long-term strategies. Logistics technology can help aggregate data to assist with all these employee tasks and can take on any highly repetitive tasks. As discussed previously, this could include digital warehousing, data analytics, picking and packing, bulk printing, and inventory management.
Step 2: Choose the right platform for your business. Once you understand your business’ unique needs and have identified the areas you would like tech to help, picking the right platform is next. This choice will come down to the mix of software and hardware that will help you achieve your goals.
Picking the right software will include deciding between a warehouse management system (WMS), transportation management system (TMS), and fleet management software. Some providers will offer a combination of these services, too. Creating a list of the benefits and features will help you make the best decision. Commonly desired features include integration to existing e-commerce platforms, return processing, pick and pack, virtual warehousing, and rate shopping.
Step 3: Implement the digital solution. Implementing a new digital platform will not happen overnight but, if you follow some simple advice, it will go as smoothly as possible.
Create and use specific KPIs: Reviewing the specific pain points and your intentions will help you create actionable key performance indicators. Include a timeline to accomplish your goals.
Put people first: Bring in key employees from each functional area of your company. Ask them to identify their area’s pain points, brainstorm solutions, discuss how they hope to use the digital platform, and communicate in the big picture.
Involve your vendor: Many digital product vendors will assist in the implementation process and may even offer follow-on services. Connect with your vendor and take advantage of all the services they offer.
The big picture
Change is hard. Digitizing your small business’ logistics processes may seem overwhelming but, when you consider the massive benefits for the day-to-day operations and the very future of your business, digitization becomes the obvious choice. Whether your main priority is to improve customer relationships, utilize data more effectively, or boost your bottom line, there is a digital platform on the market that is right for you.
ShipCaddie TWMS is the first-to-market platform that combines transportation and warehouse management systems. This unique solution allows shippers to take control of their entire logistics operations and reduces the cost of integration. Key features include virtual warehousing, live support, automated customer business rules, rate shopping, pick and pack, and return processing. In addition to these features, ShipCaddie TWMS seamlessly integrates with dozens of existing e-commerce platforms including Shopify, eBay, Etsy, Amazon and more.
If ShipCaddie sounds right for your growing business, request a demo today!