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Integrated logistics

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What is integrated logistics?

Integrated logistics provides comprehensive solutions to the supply chain organisation. It encompasses the entire company’s staff. Procedures are analysed and modified for heightened efficacy. All human and material means are implemented to provide the best possible logistical service.

Integrated logistics can be defined as a comprehensive inter-department process. Each stage involves every stakeholder within the company - working together to make logistical operations run smoothly. As such, the competitive advantage is high as end customers are delivered in a timely fashion boasting irreproachable service quality.

As part of integrated logistics, all stock resources and requirements, essential data and information, as well as human resources and service providers have a single goal. They strive to deliver orders to customers within the shortest time possible, always ensuring impeccable quality.
 

Specificities of integrated logistics

Integrated logistics is a notion that appeared when endeavouring to face market globalisation and boost competitive efficacy for e-retailers as opposed to in-store retailers.

  • Companies searched for and adopted logistical operation optimisation strategies. There were two kinds of drivers for change: speed and quality.
  • Minimising costs amidst all of this appeared as a third goal, in line with the product’s cost price.
  • Delivery counted for about 20% of total cost price.
  • By coordinating services, companies significantly increased the efficacy of integrated logistics.
  • Integrated logistics is a key factor when striving to successfully complete multi-channel deliveries.
  • Orders count different package sizes and weights for only a small number of items, most often expected within 24 hours.
  • Accurate flow knowledge helps anticipate human organisation and maximises stock management.
     

Examples and practical applications

Advantages of integrated logistics for companies

  • Good, smooth and agile organisation gets rid of most obstacles. This starts with product manufacture, where raw materials or spare parts are properly managed. This ensures major operational and human gain.
  • Thanks to integrated logistics, companies can boost their competitiveness. Their cost prices are decreased. They can gain in market shares thanks to a more powerful cost policy.
  • Integrated logistics for retail companies involved better product and stock management, and can allow for improved referencing if required by the market.

Integrated logistics: a step by step process

  • Employees must all play their part, with perfect knowledge of their role in the integrated supply chain. At the same time, management and sales executives will analyse competitors, along with their strengths and weaknesses, in order to construct strategies with a view to boosting competitiveness.
  • Analysing manufacturing methods for each product, to optimise processes, look at what expenses could be cut, check quality criteria are complied with in line with customer expectations.
  • Implementing a transparent data-sharing process between departments, thanks to permanent communication.
  • Organising production and storage areas properly has a positive impact on the integrated supply chain.
  • Transport and delivery must be absolutely flawless to win over customers and enhance loyalty.
  • Integrated logistics must perfectly anticipate customer needs, thanks to efficient provisional order management.

Technological solutions to help with integrated logistics

Companies use ERP systems (Enterprise Resources Planning), which consist in organising the company’s processes on a global scale. Its efficacy resides in sharing data to all company departments. ERP systems are most often accompanied by integrated warehouse management systems (WMS).

This being said, the last mile is always an issue. Though software can be used to optimise delivery from loading to delivery, the transfer of goods and bulk breaking in Logistic Urban Areas are not taken into account.
 

Regulatory cornerstones

  • General terms and conditions of sale, governing the operations conducted by transport and/or logistical operators, and any pertaining Civil Code articles.
  • TIR Convention.

 

[1] Source of the figures: https://www.journaldunet.com/economie/industrie/1195261-une-chaine-logistique-integree-un-atout-essentiel-a-l-heure-de-l-industrie-4-0/ / https://www.gouvernement.fr/sites/default/files/document/document/2019/09/dossier_de_presse_-_notre_ambition_pour_la_logistique_-_16.09.2019.pdf /https://www.supplychaininfo.eu/chiffres-cles-secteur-logistique/