Lead time: a double-edged sword for today’s logistics
How can you become a logistics hero, playing it safe with your delivery times?
Today, the most important factor to define how a supply chains works is time and securing that perfect transit time plays a leading role in making the calendar an ally to the success of companies, avoiding their collapse.
I’m not talking about selecting the transport mode that offers you the shortest transit time, but rather building transport logistics strategies that guarantee flexibility, tracking, visibility and delivering on time.
For all of us who are immersed in this honorable –and sometimes heroic task– of international trade logistics, one of the biggest challenges is transporting the materials and supplies necessary to a production process (or the final product to the hands of the consumer) under the premise of the lowest logistics costs. This might have been a correct way to operate… but for the transport logistics of the 20th century!
We’re already in the third decade of the 21st century, in a world experiencing a complete paradigm shift triggered mainly by the COVID-19 contingency; in this scenario, logistics definitely cannot be seen only from the perspective of logistics costs.
Our lives have changed, the circumstances are different, the demands and the uncertainty are greater; it sounds overwhelming because it is. And the secret, experts say, is to be able to be resilient; understand and accept the new environment and adapt quickly to circumstances, to get the changes flowing.
How expensive is time?
What is the cost of not having the commodities, parts and machinery ready to work?
The implications range from wasting labor force to the loss of thousands of dollars per minute as a result of a car assembly line shutdown, for example.
The truth is: the logistics operation of a company can no longer be managed based on the lowest costs.
To avoid disruptions such as the ones I’ve mentioned, companies need to have competitive solutions at hand, in the broadest sense that the international trade offers today.
It is not enough anymore that the logistics solutions offer a competitive cost, but that it also provides:
The certainty to deliver on the correct time, with…
A competitive transit time and…
Complete visibility, with the best follow up and information that technology and customer service can provide today.
The power to make time work in your favor.
How can you play it safe with time?
Three key factors are fundamental to do it:
A. Effective communication
It is vital that your communication with the shipper is direct and effective, to know the exact date in which the material will be ready to be collected (even to take advantage on transit time options).
On the other hand, it is also vital that the planning, production or maintenance team can generate accurate information on the date in which the cargo must be delivered to the consignee and the impacts of failing to delivery it on time.
B. A correct management of the lead time
The lead time is a parameter of hours or days:
What is the transit time that the logistics professional has to move merchandise from point A to point B?
This period must cover not only domestic or international transits, but also all the formalities of the international transport of merchandise, inspections, customs procedures, payment of duties, among others.
C. A good transport strategy
Once you have clear information about the availability of the material, its lead time and the restrictions or formalities that the material must comply with, it is necessary to select an appropriate international transport strategy.
When I say “adequate”, I don’t mean that it will be the most expensive or the fastest, but the one that effectively meets the lead time and has the highest percentage of success to get where it needs to be, on time.
In summary: logistics teams in control of their lead time, that manage an effective communication network and operate with an adequate transport strategy play safe with time. If they fail in one of these three factors, they are quite likely to be in trouble.
So, what do you need to play it safe with time?
The task here is quite straightforward: it is time to find a logistics partner who has the sensibility and the flexibility to design different solutions with the lowest risk and the highest delivery effectiveness, but who, also, has the resources to come up with a “plan B” and critical cargo solutions when time starts to become a problem.
Having a critical cargo team by your side is just like owning a sharp katana to become the hero of your supply chain. Heroes don’t run when the situation gets tough. They are ready to face adversity, in logistics and in life.
The future of logistics, in this environment of uncertainty, needs the best heroes, those who master communication and time strategies. Heroes that understand complex situations and have the right tools and equipment at hand to face them.
And where does EP America come in all of this? Well, we only forge the best metal and show you how you can play safe with time. We want our clients to be the greatest heroes of logistics… that is our mission.
If you haven’t talked to us yet, contact us right now to find the best logistics tools for your time-related necessities.