| In the manufacturing industry, the discipline of | | | | of service combinations in relation to individual service |
| logistics focuses on efficiently moving products from | | | | cost. For small to midsize companies that deliver |
| the manufacturer to the buyer. For large | | | | goods from the assembly line directly to retail outlets, |
| manufacturers, logistical operations can represent a | | | | logistics software can offer a basic analysis of routing |
| large expense, especially when logistical elements are | | | | options and freight rates. But companies that use |
| managed separately instead of being integrated into | | | | multiple warehouses and multiple supply chain |
| one solution. In an attempt to take the time and | | | | locations may require more, such as production |
| guesswork of out executing logistics, many | | | | scheduling analysis that develops manufacturing plans |
| companies totally or partially outsource their freight | | | | with regard to multiple supply chain locations (i.e. |
| optimization needs to third parties. A complete | | | | company's whose products are assembled at more |
| outsourcing amounts to hiring a company to move | | | | than one location before reaching the retailer). |
| products throughout the entire supply chain, while a | | | | The basic advantage of logistics software is that |
| partial outsourcing involves letting a third party | | | | offers refined shipping solutions that meet the needs |
| manage the transportation of goods through the | | | | of a variety of manufacturing situations (and does so |
| "stages" of the supply chain. However, implementing | | | | at a lower cost than hiring a third party logistics |
| logistics software is a more cost effective way to | | | | provider). For example, some solutions may focus on |
| achieve freight optimization that offers the same | | | | a particular freight carriage issue, such as analyzing |
| level of quality as a third party logistics provider. | | | | how to increase delivery time by studying |
| There are several factors that contribute to a | | | | construction schedules and highway traffic data, while |
| manufacturer's total shipping costs, including | | | | other solutions may focus on offering an integrated |
| warehouse fees, inventory fees and freight carriage | | | | solution for all logistical concerns, including carrier |
| fees. To minimize these fees, a manufacturer might | | | | loading, weight distribution, cube optimization and |
| choose to ship by air carrier instead of in tandem | | | | shortest path to destination. Studies show that |
| with freight carriage, significantly reducing warehouse | | | | manufacturer's who implement logistics software |
| fees by moving the goods from manufacturer to | | | | regularly realize a 10 percent decrease in shipping |
| buyer in a matter of hours. However, to save the | | | | costs after the first year. |
| most money, companies have to examine all three | | | | Whether your company has its own trucking system |
| cost areas with an eye toward developing an | | | | or uses a third party, logistics software can help |
| integrated cost savings solution. In developing such a | | | | reduce your delivery costs without compromising |
| solution, there are two basic issues that | | | | punctuality, efficiency or freight safety. If you need |
| manufacturers must address: finding the right mix of | | | | to simplify your delivery process and reduce your |
| freight carriage, inventory and warehouse services | | | | cost of shipping, consulting with a logistics software |
| and finding the best price for each one. | | | | provider is the best way to arrive at a solution that |
| Logistics software can help by providing an analysis | | | | accomplishes both at the same time. |