The Challenges of Logistics and distribution

In the current economic scenario, Logistics is one of the critical trade facilitators. Every business, small or large, depends on the logistics and distribution part of supply chain management for growth and flow. When a business starts dealing with import and export aspects of trading, logistics becomes a supreme source that keeps your business running.

Every company strives to grow while having the edge over the competition by expanding strategically into global markets and thereby increasing revenues. One of the crucial elements to attain the goal lies in outsourcing and distribution. The environment around these companies is constantly evolving, and we have been witnessing a major shift in the political, economic as well as technological domains around us. These changes are major, and the same reflects in the management of import and export processes. The logistics and distribution processes inclined towards a more diverse and flexible adaptation to keep up with the pace.

Importing and exporting, in every type of business, involves a pinch of risk-taking. There are multiple sets of markets involved, and each business looks at a totally strange culture and a whole new game. Though the businesses across borders are becoming more and more sophisticated, we have moved from an era where on-schedule merchandise had been replaced by in-sync merchandise.  The on-time delivery has to be accompanied by perfect condition and constant updates. The demands are changing and so are the barriers including the tariffs, taxes and other regulatory policies imposed differently in many countries across the globe.

The challenges

From the spectrum of different lead time to the complexity of collaborating, distribution is facing a lot of challenges across the way. We are looking at a scenario where a business has to collaborate with remote suppliers and partners while constantly being in compliance with regulations and other trade tariffs. The same gets a frustrating hindrance due to economic and political instabilities. Many times, a hasty decision can lead to operational inefficiencies, eroding sales and extremely high logistics costs. The entire logistic and distribution process is very fragile. Every movement hinders the cost and effectiveness along the supply chain management line, and every decision needs to be in sync with a well-thought strategic approach.

A comprehensive Network

The import and export rely on the best supply chain wherein it becomes easy to manage the cost and time constraint. At the same time, the quality is not to be compromised. To improve the business performance, it is mandatory to have an integrated and comprehensive distribution and logistics sphere to have an extraordinary edge on multi-functional operations involving purchasing, sourcing, sales, distribution, logistics, finance and customer services. Logistics and distribution part of the supply chain management focuses on in-rhythm collaboration so that a business’s work around an architecture laid upon the extremely efficient use of resources.

It is mandatory for businesses to oversee that the processes meet the corporate goals within the set frame. All the participants in the network need to have a common view of improving the performance in the cost-effective mode. The entire network from sourcing to the ultimate distribution destination needs to have a continuous information flow to ensure that the process can be relied upon.

The breakdown in the network effects in terms of reputation and money. Having a snap proof network continues to remain one of the greatest challenges in the import and export industry as the demand keeps on changing and new norms keep on entering the market. A comprehensive network minimizes the number of intermediaries and thereby helps to minimize damage or loss in transit.


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Keeping up the pace with Technology

The fact that technology is on a roll since the last decade is no news. We have seen things evolving and getting better. The distribution and logistics are at an impacting end of this constant technological evolution. When it comes to import and export logistics management, there has been a constant need of staying aligned with what the technology has to offer for improvements in this domain. The time of spreadsheets and manual processes is long gone.

The time today demands constant automation, seamless integration with Realtime information outflow at the helm of various software available across the market. This software allows the end to end the flow of information and control to ensure that the transit is smooth. The fact that these advancements are still evolving, and business have to stay vigilant and flexible to adopt the change is becoming challenging.

The adaptation becomes costly and time-consuming but is a must. With solutions like the ERP (Enterprise resource planning) the supply chain is predominantly looking at optimization. Distribution within the import and export circles is evolving with the fast pace of technology.


Compliance with the Global Trade Practices

When we talk about importing as well as exporting, we are directly pointing at a lot of international laws and norms, that are critical to the business practices. The legal system is primary and needs to be taken into proper consideration. Every country has a different set of rules and regulations, and the same reflects upon the distribution and logistics practices.

These regulations may sometime end up with a delay and every agency involved needs to produce different licenses as well as permits to keep the flow smooth. The problem is that the political scenarios keep on changing dramatically. There has been no constant so far, and the distribution processes have been keeping up by imbibing what the system offers.

This is becoming more and more difficult with places like Mexico, where the regulations are getting strict. Every political instability or major change leads to the disruption of the good inflow and outflow processes, and it becomes tough for the importers and exporters to keep up.


Real-Time Agility in Distribution and logistics

Every export and import business strive to keep the performance maximum and the costs minimum. Both the factors are directly linked to the type of transportation, fuel costs, etc. While companies started thinking about the optimal mode of transport, many other issues are getting their necks up and demanding immediate attention.

These issues include missed delivery dates, labor strikes, which in turn results in customer dissatisfaction. This challenge can be coped with contingency plans with includes real-time communication as well as collaboration with all the parties including factories, logistics providers, forwarders, and brokers. With improved visibility, the companies may be able to make informed decisions and identify opportunities. The real-time tracking may end up with a lot of impasses, and we might be able to cope up with the unpredictable external factors.

Fluctuating costs and market, speed and transparency of the processes are adding up to the list of the challenges faced by the import and export industry when it comes to distribution and logistics. Constant know-how and efforts may help in the long run, and every business has to be flexible to adapt. That is the only key to long-term success and coping with the challenges may become easier.

At Pedraza Freight Brokers, Inc. we specialize in helping the import and export process a hassle-free experience, so you can focus on running your business.  We manage it all for you.  Click for a quote:

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Pedraza Content Team

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