Business

Understanding Logistics

Understanding Logistics

Far too many business owners are put off from taking their products father away from home than local, simply because wonders don’t always understand how the logistics value chain actually works.

We’ve broken it down for you.

#1 What services does “logistics” encompass?

The term “logistics” actually refers to a pretty vast basket of services that provide crucial links between “sellers” and “buyers” at its most basic level.  What this means is that when you want to sell the super-cool clay pots that you’ve made in America, to a clay pot enthusiast in Djibouti – you’re going to need to get it there.

You’re also going to need someone to coordinate your dealings with customs and excise, packaging, collections, deliveries, accepting foreign payments, tax clearances, insurance, liability and all the paperwork that goes along with that.  Clearly, this entire process ranges from being fairly straightforward to be infinitely more complex and relies on expertise and skill within this global industry.  Learn more about the 5 elements of logistics here.

#2 What type of logistics, when and where?

This depends on your organisation and what you do.  Some businesses may need massive document delivery solutions and not need warehouse storage for example, while other businesses need warehousing, control, documentation management and freight forwarding services.  Having a key understanding of the role you need logistics to play in your business is crucial towards understanding how you can utilize the logistics services industry to add potentially massive value to your operation.

#3 Embracing logistics as a means to unlock business success

There are simple ways that you can unlock a success-driven chain reaction in your business and logistics could be considered one of them.  Many small to medium-sized businesses have not considered the access that a good logistics driven pipeline can offer them, so here are a few different scenarios for you to ponder.

  • My business is small, I don’t need to know anything about “global logistics”.  Well maybe.  If you want to keep your business small that is and if that’s your modus operandi then that’s ok, however even a small to medium-sized business can benefit from a logistics partner that can get their goods all over the globe, or to specific marketplaces based on demand and you can have your logistics interact with your online selling as sophisticatedly as you like.  This same principle applies to domestic business too.
  • Global delivery…sounds expensive?  True, if you’re not growing your business sufficiently to warrant ongoing global delivery but then with some creative pricing options for customers outside of your state or national borders a huge amount of that shipping cost can be passed on to the end consumer.  Logistics suppliers have customers that ship tons of goods globally as well as boxes – so take some time to find the right partner.
  • It seems risky…Well, it’s even riskier to not captialize on emerging market economies that have relatively high levels of disposable income and enjoy shopping from American suppliers.  Your competition is definitely looking into this.

Massive global companies like Amazon and Apple rely on worldwide logistics services to deliver on their promises.  So much so that Amazon now has a logistics reach wider than what most public service departments could get to as easily and as conveniently.  

George Bezos, founder of Amazon is also set to become the world’s first “trillionaire”.  Just saying.

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