Maintenance Q&As

What is supply chain logistics?

Answered July 28 2019

Supply chain logistics is the management of all the companies, transportation, warehouses, and distributors needed to deliver a final product. In our global economy, that may involve dozens of businesses that must play a part to procure or produce raw materials, parts, and services to get an item into the hands of a consumer.

Challenges

Managing supply chain logistics can get complicated quickly. Businesses must determine the right balance between being nimble enough to be competitive while minimizing the potential costs of tools and technology required to achieve that flexibility.

According to KMPG, two-thirds of global manufacturers do not have the information they need to manage their supply chains effectively.

As a result, many executives simply do not have the visibility they require to make the best business decisions for their company. This can lead to poor customer service, increased production downtime, and stressed supplier relationships.

Solutions

Better supply chain logistics often comes down to automated, efficient warehouse and inventory management. Although one company cannot manage the inventories of supplier companies, it can do a better job of tracking its own inventory from the point of ordering and arrival and throughout its production system.

Barcoding technology and RFID tags can improve the efficiency, accuracy, and speed of managing how inventory moves throughout your facility. These solutions, when integrated with a back-end, centralized computer system like a CMMS, can help you know exactly how much inventory you have on hand, where it is located, what it is being used for, and when it leaves in an end product or is consumed.

Benefits

As supply chain logistics is tightened up, you will likely see many benefits including increased visibility, reduced or eliminated shipment issues, better customer fulfillment numbers, and decreased risks. Essentially, supply chain logistics allows you to see potential supply chain issues before they occur and make decisions to keep materials and products moving.

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