A best-practice guide to logistics management in the retail industry

No one said retail logistics management would be easy. Follow these 5 steps, however, and you can start to take charge and see results.



"Let's talk logistics." No matter the context, this phrase suggests that a certain amount of coordination, multitasking and compromise is in the offing.

In the context of retail warehousing, logistics is all about juggling priorities in pursuit of profit and customer satisfaction. This covers the journey of an item from start to finish, with all the tentacular variables and complexities that arise along the way.

It's not easy. But then, nothing is. Rather than despair, your best bet is to take concrete steps to tackle the logistical octopus to the ground and make it work for you. (Please note: no octopi were harmed in the writing of this blog post.)

These steps cover fulfilment speed, cost-effectiveness, technological solutions, reverse logistics and key performance indicators (KPIs). No one step will fix the logistical hole in your operations. Taken together, however, they can make a real difference.

Most of these changes can be made with the help of a cloud-based warehouse management system (WMS). This is a multifaceted piece of software that helps you improve the accuracy, efficiency and visibility of your warehousing operations.

So, without further ado, here are five steps that can help you take charge of logistics management in line with industry best practices.

1. Accelerate fulfilment

How is order fulfilment like livestreaming? Both are reflections of the fast-paced, even hectic world in which many of us now live.

The fact is that many people are now accustomed to speed – whether it's an instantaneous broadcast with their phone, a short-haul flight or next-day delivery.

Basically, people want their orders to arrive quickly, please. If you can't provide fast delivery, you can still shift units. But you'll also lose custom to competitors who offer a swifter service.



Fulfilment speed depends on several factors – transport, for instance. But it all begins in the warehouse.

Are your picking paths optimised? Do your staff have the tech they need to pick, pack and dispatch with speed and accuracy? If the answer is no, it's time to invest in accelerating your fulfilment.

2. Reduce costs

Mistakes are an expensive habit. If your goods arrive late or damaged, you'll probably lose custom. This lost custom comes both from the disappointed customer and the would-be customers scared away by negative online reviews.

Increasing your cost-effectiveness, then, is partly a case of increasing your picking accuracy. But the quest for cost reduction doesn't stop there.

Carrier contracts need to be negotiated to ensure you get the best bang for your buck. Demand forecasts need to be made to ensure you only stock what you need.

These decisions are difficult to make without data. And the best way to get accurate, visible data is via a WMS – preferably one based in the cloud for remote accessibility and scalability.

This brings us to our next point: the need to embrace technology to make your logistics management work for you.

3. Embrace technology

Technology has always influenced logistics in the retail industry – from the advent of standardised containers to barcodes to internet tracking.

Today's technological fix is the cloud-based WMS, a remotely accessible piece of management software that gives you end-to-end visibility and near-perfect picking accuracy.

The benefits of a WMS are legion. They enable you to forecast demand with precision, spitting out reports with just a few clicks of the mouse. They give warehouse leaders instant access to the status, location and quantity of every item in their inventory.

A WMS can also facilitate other technological fixes. Barcode scanners and voice-picking headsets can be easily integrated, improving accuracy across all levels of your warehouse operations.

4. Make returns easy

What if we told you that logistics isn't a straight line, from supplier to customer, but a circle? This is because of the crucial role that returns (also known as "reverse logistics") plays in logistics management

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There are two reasons why easy returns are an essential part of best practice in logistics. The first is that they let you, the warehouse leader, recapture lost value, whether by returning the item to the shelves, repairing it or recycling it.

The second is the positive impact it has on customer satisfaction. Returns are like the fulfilment process in general. If the customer doesn't know where, how or when to return their item, they're likely to resent you for it.

Instead, put time, money and effort into making a clear and easy returns process and you'll soon feel more in charge of your warehouse – and increase your profits to boot.

5. Monitor metrics

The purpose of logistics is to get results. But how do you measure those results?

This is where metrics such as KPIs can make a big difference.

We've written elsewhere about how to define KPIs for inventory management. They could include:

1. Optimising stock levels
2. Reducing carry costs
3. Improving order fulfilment
4. Improving forecast accuracy
5. Gross margin return on investment (GMROI)
   
   

All of these metrics follow the so-called "SMART" framework. They're specific, measurable, achievable, relevant and time-bound.

Whichever KPIs you go for, they provide useful yardsticks to measure success. They also help foster a sense of accountability within your brand by allocating metrics to individual staff members or teams.

Best practice in logistics management has to include metric monitoring – and this is another area where a WMS can help.

Minster WMS has been creating business software in the UK since 1978. Our WMS solutions incorporate a highly capable logistics management system, including features like voice-controlled marshalling, GPRS tracking and in-cab management. Want to make your logistics operations work harder? Get in touch with our experts for a free demo.