The term “lean business” means all business processes have been optimised, including sourcing, manufacturing, freight forwarding and accounting. Generally, the supply chain manager of an will have the know-how to most of the processes involved efficiently, however, complicated functions like freight forwarding require a thorough understanding of the details of the process, as well as a global resource network and industry experience.
This is why many supply chain managers in Australia choose to align with expert freight forwarders as it provides assistance to operate a lean supply chain.
Established Australian freight forwarders in Australia have been implementing lean approaches such as Lean 6 Sigma, transport management systems, cloud-based data cost reduction programs to add value within the supply chain. That means the businesses working with them also benefit from these leading-edge approaches.
Read on and discover the five things your freight forwarder should be doing to help you run a lean business and how they optimise your processes to reduce waste and ensure supply chain success.
1) Eliminate all the additional charges/cost overheads
Whether your business is lean or not, analysing your supply chain costs is easy to do. So, if despite low manufacturing costs, your product costs are comparatively high, it is likely your freight forwarder is not operating in a lean manner.
Cost overheads such as detention, demurrage, bunker surcharges, custom penalties, port congestion charges and losses due to damages impose extra costs for a supply chain manager and increase the landed cost of the product. In addition, the freight forwarder is also responsible for any direct and indirect hidden costs arising from poor processes or unnecessary waste. Therefore, your freight forwarder must proactively monitor and organise the relevant processes to eliminate these unnecessary charges.
2) Use technology-driven solutions for better monitoring and productivity
A lean business consumes fewer resources to generate greater outcomes. When you plan to reduce the supply chain glitches and achieve minimum time and cost, you need superior technology to support the processes. However, for a supply chain manager, investing in the appropriate technology may not be a wise decision, as it may not deliver the sound return on investment. On the other hand, your freight forwarder’s association with multiple companies makes it feasible for them to invest in technology and implement it to improve processes and reduce errors.
You can ask your freight forwarder about the impact of tools like transport management systems, RFIDs, Electronic Data Interchange, CRM and cloud data management in terms of the supply chain operation and based on their insights, implement suitable in-house systems for eliminating any waste.
3) Think proactively to reduce delivery lead time
In supply chains, managing time is absolutely crucial, and every extra minute costs money. Whether your trucks are waiting for loading or unloading, or a shipment is detained due to incomplete documentation, or workers are doing overtime because of poor management, any of these issues can impact your delivery timelines, decrease customer satisfaction and increase costs. Your freight forwarder must focus on these areas and apply lean principles, and also train the workers involved to optimise turn-around time.
Shorter timeframes puts you closer to customer demand, with the added benefits of reducing reliance on forecasting, increasing flexibility, and reducing waste from oversupply.
4) Ensure two-way information flow
Running a lean business is not something you can make happen overnight! Supply chain managers need an effective two-way information flow to enable continuous improvement. For process optimization, the information also needs to be accurate and complete.
Your freight forwarder acts as a connecting link in your supply chain, joining together transporters, customs agents, manufacturing units, warehouses and your customers. They relay your instructions downstream, allocate tasks to the team as well as gathering any relevant feedback. It is important to consistently be in contact with your freight forwarder so you can gather strategic insights. This intelligence is very useful for improving your service levels, generating accurate forecasting and identifying and eliminating poorly performing elements.
5) Continuous review and supply chain optimisation
The hallmark of a first-class freight forwarder is they will regularly review your supply chain setup. This means casting an eagle eye over your freight forwarding network, warehouse locations, inventory management and transportation solutions to ensure it is being operated in an optimum manner that will deliver the fastest transit times and lowest costs.
In addition, your freight forwarder must coordinate effectively with all the associated service providers and the relevant workforces to ensure they are aligned with the company’s vision and performing as required. The question that needs to be asked constantly is, are they performing at their leanest? Because technology enables businesses to build visibility, speed up information flows and eliminate wastes in the supply chain, when reviewing your supply chain, freight forwarders should make sure that every link is equipped with the latest technology.
How a freight forwarder helps you operate as a lean business
Your freight forwarder acts as a facilitator between you and your customers and effectively acts as a representative for your services and brand name to the market. In addition, they are responsible for dealing with freight forwarding challenges. Expert Australian freight forwarders are hard-wired to navigate the challenges and develop commercially-sound solutions. They will ensure that every link in your supply chain is refined and optimised according to lean principles and your customers’ needs.
For more than a century, BCR has continued to help small, medium and large businesses achieve an optimum logistics solution with warehousing and transportation, including air freight and sea freight services to and from the major ports including Brisbane, Sydney, Melbourne, Adelaide and Fremantle (Perth).