Balancing on the thin, red supply chain line

Courier and logistics companies face a number of critical issues related to efficiencies and costs, particularly the number of queries per invoice issued. Mark Lilje, MD of RangeGate, offers a solution that can deliver your business from beyond the thin red line.

Logistics operations make as many as 12 telephone calls per invoice query, impacting the entire supply chain with the retailer, courier, distributor and manufacturer potentially incurring costs as high as R100 to reconcile each exception.

Overcoming this can be as simple as deploying mobile data capture software and hardware in the supply chain. The visible service and efficiency gains of this system, combined with intelligent back-end system interfacing, means that products such as these more than pay for themselves. Direct benefits of using an integrated supply chain solution with a mobile capability are:

* Elimination or reduction of paperwork
* Queries resolved at point of contact
* Elimination of credit notes, leading to a reduction in debtor days, with a direct impact on revenue
* Same-day deliveries
* Clean invoicing
* More efficient driver debriefs
* Active resource management
* Full back-end integration
* Vehicle monitoring

Famac, a parcel delivery firm in Northern Ireland, has deployed such a product to manage delivery and collection procedures across its supply chain.

Benefits that the business has experienced include:

* Improved parcel tracing capability after they leave the depot
* Improved operational accuracy
* Better customer service levels
* Fewer goods lost in transit
* Greater efficiency in electronic data capture and retrieval

Michael Donnelly, Famac operations director, says his organisation wanted to take control of the supply chain to meet the changing requirements of customers and continue the business`s ongoing programme of improvement.

According to a new study published by IDC, business agility, stock optimisation, and supply chain efficiency will be among the top pain points that Western European retailers will face during 2004. Other hot issues include cost reduction and optimisation, and the accuracy of the increasing amount of data retail organisations collect.

Cinzia Rinelli, senior research analyst with IDC`s European Vertical Markets research group, said in a press release that the retail industry is at a turning point, and whether an organisation thrives, survives, or dies depends largely on the strategic use of technology.

Some European companies are already discovering the benefits of optimising the supply chain and gaining flexibility as a result.

Silicon.com reports that House of Fraser is running an international pilot of radio frequency identification (RFID) tags on individual items of clothing in search of cost savings.

Sony Ericsson published third-quarter results showing a profit for the first time in several years, partly attributed to polishing the supply chain and improved operating efficiencies.

Marshalls, the UK-based landscape materials manufacturer, has adopted a GPRS-based vehicle tracking system to improve fleet management with a two-way messaging system in 150 vehicles, that is integrated with Baan and its dynamic routing and scheduling technology, reports ComputerWeekly.com.

These initiatives indicate the mature approach to technology that some of Europe`s leading companies are taking and deriving the benefits of.