How Procurement Market Intelligence Solution Improved Logistics Management Process for a Retail Firm – A SpendEdge Case Study
The Business Challenge The client, a leading retail company with convenience stores spread across the United States, wanted to focus on the “last mile” delivery of groceries ordered online. They sought to manage merchandise and inventory to ensure steady sales of stock and reduce chances of stock reduction. They also realized the need to handle problems [...]READ MORE >>
The Business Challenge
The client, a leading retail company with convenience stores spread across the United States, wanted to focus on the “last mile” delivery of groceries ordered online. They sought to manage merchandise and inventory to ensure steady sales of stock and reduce chances of stock reduction. They also realized the need to handle problems related to the distribution network that were resulting in wastage of time and money. This compelled them to engage with SpendEdge and closely scrutinize their distribution network to ensure effective logistics management and achieve the following objectives :
- Analyze market size and growth rate, manufacturing process, and critical-to-quality factors.
- Evaluate costs associated with materials, labor, transportation, energy, overhead, profit, and other cost components.
- Critically evaluate available suppliers, their characteristics, and location where suppliers of the category are situated.
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The experts at SpendEdge worked closely with the client to address the challenges of logistics management and distribution network. They identified demand and price drivers that determined price and availability of products and provided real-time insights to determine appropriate supply markets. This highly focused approach helped the client to design facilities to manage an increase in SKUs and variety of order profiles.
The solutions offered improved the logistics management capabilities for the client and allowed them to incorporate strategies such as cross-docking. This enabled them to improve supply chain logistics capabilities and accelerate the velocity of inventory. Additionally, this improved the logistics management process for the client and ensured quick deliveries in minimum time and cost. The systemized logistics management process considerably reduced the cost of carrying inventory, material handling, transportation, and other related activities of distribution for the client.
SpendEdge’s solutions allowed the client to be more responsive to customers’ demand, speed time to market, and avoid the cost of carrying and managing a heavy volume of safety stock. The comprehensive market research approach focused on the best practices to improve supply chain logistics and helped the client to react in quick time to changing trends in customers’ demands. They were also able to better gauge consumer sentiment based on both online and offline trends to improve logistics management capabilities and reduce strain on supply chain networks.
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In a span of six weeks, the solutions delivered by SpendEdge minimized the cost of physical distribution of the products by 29%. This enabled the client to attract additional customers by offering better services at lower prices. Moreover, an improvement in logistics management capabilities helped reduce the wastage occurring in the supply chain and streamlined the flow of the products to the end consumers.
The procurement market intelligence solutions offered by SpendEdge delivered an array of critical benefits, including reducing costs of distribution, improving customer service, and reducing chances of “no-stock” situations among others. It redefined the process of logistics management, saving time that was lost in making urgent deliveries and reducing the cost of inventory. Integrating distribution networks proactively also helped the client to ensure the smooth transition of products from manufacturers to retailers to meet customer demands on time.
What are Three Methods for Managing Logistics?
As logistics management plays a vital role in increasing the performance of the business, companies need to find ways to manage supply chain logistics. They can adopt various strategies according to their business needs. Here, we have compiled three key steps that can improve the logistics management process:
- Inventory management: This is one of the most crucial steps in logistics management. An efficiently managed inventory helps identify a minimum stock level and keeps goods shelved to implement FIFO, or first-in, first-out, especially in the case of perishable inventory.
- Automating processes: Automating the logistics management process helps companies to unlock value in supply chain logistics and streamlines operations in the long run. It also ensures that operations such as finance and accounting, logistics and supply chain management, and customer services are tightly coordinated to boost efficiency.
- Planning and communication: As convenience product distributors work in a highly competitive environment, planning is vital to make scheduled deliveries and avoid no-stock situations. With an effective logistics management process in place, companies can easily communicate regular updates to delivery personnel in advance.