Supply chain management: what is it? Managing and organizing the complete flow of products and services—from manufacturing and supply to consumer delivery—would be the so
Supply chain management: what is it? Managing and organizing the complete flow of products and services—from manufacturing and supply to consumer delivery—would be the solution. Now, how would you manage this supply chain's whole flow? Indeed, by means of logistics.
Transporting items from one place to another is not the only role logistics plays in supply chain management; it is also essential to a supply chain's overall operation.
India's eCommerce retail logistics market has seen rapid growth, driven by increasing internet penetration, smartphone usage, and favorable government policies. Companies invest heavily in logistics infrastructure and technology to meet rising consumer demand and expectations for faster delivery and efficient supply chain management. This evolution underscores the critical role of logistics in the success of eCommerce businesses operating in India's competitive market landscape.
From $2.2 billion in FY21 to $6.3 billion in FY26, the Indian eCommerce retail logistics market is predicted to expand at a 24 percent compound annual growth rate (CAGR). The data unequivocally demonstrates that Indian eCommerce merchants know the value of logistics. An effective logistics system can minimize resource waste, save operating expenses, raise customer happiness, and do much more. So, in this blog post, let's dive into supply chain logistics.
The term "supply chain management," which encompasses logistics, is more general and intricate. While logistics handles resource internationalization, the supply chain handles end-to-end optimization. Transportation, import and export, shipping and receiving, warehousing, inventory control, procurement, production scheduling, and customer service all fall under the complicated logistics umbrella.
Companies use logistics to manage, coordinate, and track the resources required to move goods in a timely, dependable, and cost-effective manner. They view logistics as a crucial supply chain blueprint.
In the existing digital era, businesses of all sizes can impact their bottom line and scale their logistics operations to produce growth and success commensurate with their level of innovation.
When supply chain management and logistics are integrated, expenses are decreased, and optimum efficiency is achieved. The following points explain the function of logistics in supply chain management:
Logistics is the study of moving things from one place to another, and transportation is how different supply chain operations are linked. eCommerce firms must consider several aspects when selecting a shipping method, such as cost, availability, distance, and route conditions. Air, sea, or land could be the best option. A comprehensive analysis of the transportation infrastructure is required to ensure prompt delivery at the most economical price and optimize supply chain effectiveness. India's most cost-effective shipping method is via rail, but due to its numerous disadvantages, most businesses opt for road transit.
Order fulfillment is receiving, handling, and delivering orders from customers. This is where the efficacy of a logistics system is assessed. As part of the order fulfillment process, orders are selected from the warehouse, appropriately packaged, tagged, and then dispatched to the customers. This feature becomes even more crucial when customers seek same-day delivery of their orders and faster order processing. Last-mile deliveries are still done by hand despite the fact that order processing is now primarily automated rather than done by hand. This calls for an efficient logistics infrastructure.
Logistics operations and warehouse management collaborate to make last-mile delivery easier. Logistics standards are followed when scheduling and organizing warehouse inventory. Commodities that need to be transported or ordered frequently are positioned in front of warehouses for convenience of handling. In contrast, low-demand products are typically positioned toward the back of warehouses, and perishable commodities are regularly cycled, meaning that the oldest items are shipped out first.
If eCommerce businesses wish to cut waste, they must handle returns with the same attention to detail as order fulfillment. Similar to how logistics are crucial for delivering goods to clients, they are also essential for obtaining them back when needed.
Last-mile delivery is essential to customer satisfaction and can only be achieved with an efficient logistics system. It helps companies react to customer orders promptly and efficiently without any hiccups or delays.
Demand planning is a dynamic process requiring continuous monitoring and adjustment. Companies must routinely compare actual sales to forecasted demand, identifying variances and adjusting plans based on market shifts or performance discrepancies. This iterative process mitigates risks, enhances forecast accuracy, and optimizes operational efficiency, ensuring responsiveness to market conditions.
Anticipating future demand is necessary for effective stock and replenishment planning. Artificial intelligence (AI) algorithms allow firms to make well-informed decisions about inventory management by accurately predicting product demand for specific seasons or times of the year. AI enhances logistics supply planning by analyzing lead times, expenses, sales data, and manufacturing schedules. This analysis helps businesses determine optimal safety stock levels, replenishment schedules, and reorder points. By preventing unexpected inventory shortages or surpluses, AI reduces costs and provides better control over expenditures.
Adapting to changing consumer expectations is crucial in today's rapidly evolving market. Companies that stay attuned to customer preferences can adjust their demand planning strategies accordingly, ensuring they meet consumer needs effectively. This adaptability improves customer satisfaction and enhances brand loyalty and market competitiveness. By leveraging AI and other advanced technologies, businesses can swiftly respond to trends, anticipate shifts in demand, and maintain a resilient supply chain, ultimately driving sustained growth and success.
The delivery of goods to consumers has evolved due to technological innovation, with disruptive technologies emerging as a crucial element of both user appeal and operational efficiency. Digital twin technology is unique among these advancements since it offers a virtualized version of real-world items, processes, or systems, making it possible to test and monitor without requiring the real thing.
TADA is the leader in Ultimate Command & Control for Supply Chains, which enables businesses to connect the siloed parts of their networks to deliver real improvements in cost, cash, carbon, and revenue. Powered by its proprietary, AI-enabled digital twin platform, TADA's solutions offer the best time to value in the industry, providing real-time visibility, actionable insights, and multi-enterprise collaboration and orchestration that empower businesses to take charge of their supply chains.
Running an online store requires having a functional supply chain. As a result, supply chain management is the cornerstone, and logistics is vital to any business. Now that you are aware of the significance of logistics in supply chain management, all that is left to do is apply what you have learned. However, if you run or intend to run an eCommerce business, you might need clarification to select the appropriate logistic partner.
