Shipping and supply chain management is always complicated, and it seems like it’s only becoming more complicated as time goes on. As supply and shipment chains stretch to cover the world, the entire system becomes increasingly fragile. Even a single mistake can have a ripple effect affecting large portions of your supply chain!
US Logistics Solutions is a logistics company that specializes in helping operations modernize, streamline their services, and avoid costly supply chain mishaps. These are some of the most common mistakes and challenges we see, along with solutions for avoiding them.
Five Frequent Supply Chain Issues and How to Overcome Them
1 – Over-reliance on manual operations
It seems obvious that a sufficiently large supply chain management process would require automation and other computer assistance – yet according to studies – a majority of shipping operations still rely on humans doing processes and recording data by hand.
This is simply too inefficient and too error-prone to be a viable strategy once a supply chain reaches a certain size and level of complexity. Problems and mistakes will only add up as the supply chain grows.
The solution is simply to upgrade processes to incorporate automation and AI data analytical systems – or to hire a 3PL/4PL logistics company to handle the management on your behalf.
2 – Too many critical single points of failure
A single point of failure is any situation where an operation relies on one – and only one – machine, item, or process which is necessary for the entire operation to work properly. If anything should happen to that single point of failure, most or all processes will be inhibited or shut down entirely.
The problem with single points of failure was sadly illustrated with the COVID-19 outbreak, with many shipping operations being completely shut down due to a shipping center closing due to lockdown or quarantine.
A good logistics manager should be constantly surveying their overall operation, and asking “What happens if this component fails?” Whenever a single point of failure is identified, steps should be taken to ensure there’s a backup plan in place. Good logistics companies can also help get a handle on complicated operations and ensure no failure points go overlooked.
3 – Inaccessible or siloed data
A modern shipping operation thrives on data. With the right analytical systems in place, logistics can be better understood, streamlined, and provide actionable data for future forecasts and planning. However, this is only possible when data within the company is shared or put into a central database for comprehensive analysis.
Older processes, typically dating from the 20th century, often have separate “siloed” databases for each office or division. I.e., sales has a database, the warehouse has a database, the shippers have a database, etc. This inhibits the sort of robust analytics needed for a highly optimized operation.
Supply chain managers should be looking toward setting up central shared databases, so all information is available to any authorized individual/department/AI which needs access. And, obviously, that database should be backed up on multiple servers, to avoid being a single point of failure.
4 – Too little visibility into processes
If a customer asked, “where is my shipment right now?” would you be able to give them an exact answer? If not, you probably don’t have enough visibility into your shipping processes.
A modern shipping and logistics operation should be able to track every shipment, even every individual item, and always know exactly where they are at any given time. Besides being useful information to make available to your customers, clients, and/or partners, this is also more critical data that can be put into your analysis systems.
With true end-to-end visibility, you’ll be able to optimize processes while shipments are on the road. Look for drivers/shippers who have the best (or worst) performance or identify warehouses that underperform and slow down operations. This improves your service, as well as opens up more opportunities for cost reduction.
5 – Too many problems during transit
Above all else, from a customer or partner’s perspective, a shipper must be reliable. They need to know that their shipments will arrive at the right place, on time, and without excessive damage to the load. If these criteria aren’t met, a shipping operation will struggle.
With proper data collection and end-to-end oversight, it becomes possible to start diagnosing any issues leading to problematic deliveries. For example:
- Substandard packaging could be contributing to product damage, especially if you know via data that the drivers are driving properly and safely.
- Schedules may be too tight, forcing drivers to choose between speed and safety – a situation which will almost always lead to more problems, rather than fewer. This would indicate a need to build in more buffers, or better expectation management among receivers.
- If the time it takes for a delivery order to be picked and loaded at a warehouse, you should be able to pinpoint which warehouses (or potentially even which specific workers) are causing the issue and implement appropriate corrective measures.
- If damage is occurring at a dock, are the goods being handled by your people, or by another party such as the receiver? You may be able to nail down who is actually causing the damage and avoid harmful false accusations.
Better Data Analysis Leads to Better Results
The takeaway here is simple: A modern shipping or logistics concern needs robust data collection and analysis systems if they are to remain competitive. Trying to handle operations by hand simply isn’t good enough, especially once supply lines stretch across the globe. Investing in better analytics or hiring a logistics company to act as a partner, will improve operation across the board.
US Logistics Solutions has decades of experience providing software support, 3PL/4PL services, and other supply line management services across the eastern United States. Contact us to learn how we can help improve your own operations!
It’s great that you explained the importance of working with a trustworthy shipping partner to avoid major delays and damaged products. Recently, my sister said she’s starting an e-commerce business and is looking for a freight company to get her operations started, so I’ll share your insight with her right away. Thank you for describing how a shipping partner must make sure your products arrive on time.