5 Common Logistics Mistakes Indian SMEs Make (And How to Avoid Them)

A lot of SMEs are not aware of the current challenges many face while understanding logistics. Even a minor inconvenience can add up to needless costs for the organization. Let us look into why and how these mistakes are made and how to overcome them.

1. Partnering with Third-Party Logistics Providers

Long wait times for deliveries and improper packaging can greatly hinder the growth and maintenance of an SME. Goods can be damaged if not packaged professionally, and certain unexpected issues can arise if shipments aren’t properly tracked. Rising fuel costs and poor roads in India are quickly becoming a big obstacle in operations as well.

A third-party logistics provider is essential to secure packaging and fast deliveries. These deliveries can also be tracked, and a schedule can be set for them. Trusting a third-party logistics company can also reduce individual transportation costs of SMEs, rendering their clients stress-free.

2. Proper Planning and Organization

Oftentimes, inventory shortages arise due to a lack of future planning and forecasting. This can undermine the organization’s reputation and sales. Overstocking, on the other hand, is harmful in terms of costs and takes up valuable storage space for other goods. Improper warehouse management is also a problem.

Develop a logistics plan that showcases future growth, inventory management, schedules future shipments, and transports. This plan should be regularly updated to keep up with the organization’s progress.

There should also be proper communication so that no delays take place due to misunderstandings.

“high cost of logistics accounts for around 13%-14% of India’s GDP, compared to the global average of approximately 8%.

3. Staying Updated with Technology

To boost productivity in the modern fast-paced world, one should invest in the latest software and technological improvements for the organization, like warehouse management software and GPS tracking of shipments. GPS tracking is already provided by most logistics providers, if you choose one.

This also includes third-party logistics providers that offer flexible delivery options according to your needs, no matter the size of the organization or the shipment.

Embracing AI, cloud-based management, and analytics software for sales and purchases is also a wise decision.

4. Using Skilled Workforce

Personnel have a large role to play in the logistics sector. SMEs often find difficulty in getting highly skilled or experienced people. This becomes a hurdle in their growth and affects their scaling ability.

Many logistics companies, however, hire skilled professionals, like packers and movers, to efficiently carry out transport operations and projects. They can do the packing for you.

5. Always Having a Plan B

Since most SMEs rely on small vendors and suppliers, sometimes their supply chains are fragmented due to issues on the other end. It leads to delays and inconsistency, which can cost you a lot more. Always have an alternative to these most likely disruptions, like having a backup supplier for emergencies, and extra goods.

Identify potential problems and have a plan ready for them, just in case.

Conclusion

The logistics sector in India has a long way to go, considering the road inefficiency and slow technological advancement. However, many SMEs understand the need to put their logistics as a priority and integrate the workforce and resources of the company into it. This would greatly reduce transportation and storage costs. With these tips in mind, one can avoid the most common logistics mistakes and rise above the competition.

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