Why is logistics management so important?
Logistics is a complex industry with a fragmented ecosystem that involves enormous amounts of data and transactions that need to be efficiently streamlined. There are a number of challenges in logistics and 57% of companies believe that logistics management solutions give them a competitive edge that enables them to further develop their business (Source: GEODIS, 2019). Therefore, efficient logistics operations management is a key factor contributing to the seamless functioning of business operations.
What are the biggest challenges in logistics management?
Logistics operations management involves the coordination of logistics owners, fleet managers and truck drivers. The process of transporting goods involves the need for real-time visibility, managing expenses and analysing crucial data. Let’s take a look at some of the biggest difficulties involved in logistics management.
- Logistics Owners: As logistics owners, it is difficult to manage the entire process without visibility and automation of certain key aspects of everyday operations. The major challenge is to save costs and improve the process by tracking information and receiving real-time updates throughout the process from shipment to delivery.
- Fleet Managers: There are a number of challenges in fleet management. Fleet owners and fleet managers irrespective of the size of the fleet face challenges in coordinating expenses and operations. The time spent on administrative tasks such as quotation, invoicing, dispatch, scheduling fleet maintenance, and other activities take a lot of time and effort.
- Truck Drivers: Truck drivers travel for many miles or even for days together on rugged roads and unpredictable weather conditions which take a toll on their well-being and eventually affect the delivery of goods. Moreover, they are prone to distractions while driving which leads to theft or accidents and vehicle maintenance is a huge task that has to be tracked on a regular basis to prevent major repair or replacement costs. Most importantly, one of the major challenges faced by truck drivers is unifying all fleet-related expenses without which they will be required to carry a huge amount of cash and might also need different payment methods for varied expenses like fuel, parking, tolls, repairs, food, lodging and more while traveling.
How does the fintech industry solve the challenges of logistics?
Fintech platforms are revolutionising logistics operations management through unified systems, digital fleet management solutions and value added services.
- Unified System: Supply chain visibility is among the top strategic priorities of companies worldwide (Source: GEODIS). Fintech companieslike Axlerate provide a unified ecosystem for logistics management to provide high visibility for comprehensive and effective processing of logistics operations, payments and services.
- Transportation Management Solutions: According to a study conducted by Forbes, transportation management services can improve freight savings by up to 8%. Fintech industry provides transportation management services where fleet managers can unify all their fleet-related expenses and receive additional benefits on qualified purchases. They can onboard vehicles and drivers and allot cards and money for their trip accordingly. It helps them to easily monitor and manage all expenses in a user-friendly dashboard.
- Value added Services: In a study conducted by Save Life Foundation, About 10% of fleet owners stated that they provide life insurance to the drivers, about 9% provide health insurance, and about 7% provide provident funds to their drivers. Fintech industry provides value added services for truck drivers in terms of escrow, insurance, cashless and discounted fuel purchases, vehicle tracking and direct commissions on transactions.
Let’s Wrap Up!
The logistics industry requires logistics management solutions for frequent exchange of information and payments involving logistics owners, fleet managers and truck drivers. There is a need for real-time visibility, transportation and expense management along with other required solutions. Fintech industry provides solutions for efficient logistics operations management with a unified system, transportation management services and value added services.
