Optimising Your Business In A Recession
LPC International has been assisting clients to put in place operational systems and procedures for 25
years. These systems and techniques have enabled logistics businesses to survive previous downturns, and also helped them emerge stronger and fitter when the upturn arrives. Though this recession will bite deeper, recovery will come, and those businesses that have managed best will have an advantage in the upturn.
What then can be done to address the problem?
If you have sufficient resources and are confident enough to invest capital then develop new facilities and infrastructure for the future, if not, then planning for recession is about driving down costs to become “leaner and meaner” while maintaining a healthy customer base.
Aside from the administrative processes there are three fundamental areas in a logistics business where appropriate, and relatively straightforward, initiatives can be introduced, namely
- Inventory Management
- Warehousing Operations
- Transport Resource Planning
Inventory Management
The challenge of inventory reduction comes to the fore and has a dual benefit in that it not only saves on the “direct” costs of ownership, but can also lower warehousing costs, due to the need for less space…
Warehousing Initiatives
Centralisation of stock can combine and rationalise order processing, inventory control, administrative, security and managerial resources. It also creates the opportunity for the prudent investment in appropriate advanced storage and materials handling systems can much improve productivity levels and “sweat the property asset” which are the main costs bases. This backed by a suitable warehouse computer management system additionally improves productivity, order accuracy and, again the use of space…
Network Planning and Transport Initiatives
Reductions in the number of warehouses in a network or any move towards centralisation will affect transport costs. As a norm, the more warehouses there are in a network, the greater the warehousing and inventory costs will be, and the lower the transport costs will be. It is therefore important to balance these to find the optimal network solution…
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