Alongside the economically efficient flow of products and information, the goal of logistics is primarily customer satisfaction. Their requirements, suggestions, or comments highlight the problems faced by logistics operators. Recognizing a problem is half the success in solving it. The desire to improve the functionality and efficiency of the logistics process therefore results in the dynamic development of the IT and technology market. Advanced technologies and innovative solutions are currently enjoying huge interest among companies that use various logistics strategies in their operations.
A modern and effective logistics strategy is worth its weight in gold these days because it positively influences the speed, reliability, and safety of deliveries of various types of goods, while maintaining the principle of cost optimization. The priority for many companies managing supply chains is to reduce warehousing costs to the lowest possible level. Research conducted in the USA indicates that nearly 60% of freight forwarders and logistics operators plan to purchase or upgrade the IT system supporting their supply chains. For comparison, in 2006, only 41% of them were interested in such a move.
The visible dynamism of the global logistics services market favors the development of technology and the search for the best logistics solutions that support production, service, and information processes. Most companies, which mainly focus their attention on reducing overall operating costs, intend to start implementing a self-invoicing system for business operations. An example of a system that improves accounting operations in a company is TMS (Transportation Management System). Thanks to it, a logistics operator or freight forwarder pays the carrier a specific price for the service, including additional fees, upon receiving confirmation of delivery from the supplier. This fact is of significant importance from an economic point of view, because the entire process of controlling the accounting of financial operations rests with the carrier. In return, the carrier receives immediate payment of their receivables. Rapid processing of the operator’s liability payments significantly improves the carrier’s “cash flow“. Furthermore, the operator of the logistics and transport process eliminates the costs associated with maintaining records of business events related to transport services. The creators of TMS announce the development of their product in terms of functionality and increasing its geographical reach. Moreover, the company that developed TMS expects that American suppliers currently cooperating with this system will look for opportunities to establish trade contacts in Europe and Asia.
Companies are increasingly moving away from traditional methods of financial settlement with carriers and replacing them with online cooperation. This solution eliminates potential overpayments and enables the creation of reports on expenses related to shipments. Cost analyses, prepared on the basis of these reports, form the basis for calculating the starting price. Thanks to this, companies strengthen their position during negotiations regarding more favorable transport rates or additional fees. An important, but often overlooked area for increasing a company’s profitability is the ability to match information about cost allocation to the system of charges related to the cargo. It prevents the chaos effect resulting from inappropriate decisions in the areas of pricing, product investment strategies, distribution network projects, or strategies for acquiring information and customers. In times when transport expenses are constantly increasing their percentage share in total operating costs, their accurate calculation has become extremely important. It helps in choosing the right strategy for a specific company.
The company GT Nexus recently announced its new product GT Nexus Trade, which will allow logistics operators and financial institutions to track the flow and status of received orders, resources, and freight on a global scale. Thus, new opportunities are opening up to strengthen the position of working capital through new, more creative financial strategies. Another example is the company GXS, a leader in the logistics solutions market. To increase the speed of cash flows in the future, it has proposed a service for delivering invoices according to individual rules and regulations in force in the company.
When “on demand service” solutions appeared on the market, some companies were quite skeptical about them. This was primarily due to concerns about lowering the level of security or weakening business integration. These doubts were dispelled through research conducted in companies of various sizes and from various industries in the United States. Additionally, during the research, synergy effects were observed. Software vendors are transforming IT systems so that independent applications are unified in the form of a platform. Through it, employees of the company and the value chain could carry out the process according to the division of roles (via interface and Web services). Thanks to services of this type, attention is focused primarily on the timeliness of transport service deliveries, planning, and the implementation of all decision-making processes occurring in companies. However, the direction of concentration is undergoing modifications and is expanding to include workflows, business processes, as well as users – both within the company and participants in the global value chain. The ability to observe the course of processes, management decisions, and present the scope of managerial authority in the form of an integrated electronic platform provides the possibility of real-time control. Additionally, it eliminates the costs associated with the implementation of the service itself and its integration with the company’s business partners.
The article comes from the magazine “Logistyka” 5/2007.