Starting a business? Avoid 3 common logistics mistakes newbies make
MANILA, Philippines — You have just started a business of your own, and you’re so excited about it. After all, it is your first business venture and you’re putting all your stakes in it. You have such incredible products on hand, and you see so much more potential.
While it is good that you are so enthusiastic about the business, make sure your focus is not only on product development and sales. When it comes to business operations, the importance of proper logistics cannot be overemphasized.
It may sound too complex for you, as it encompasses many aspects — from storing materials and finished products and managing your stocks to fulfilling orders and moving products — but it requires attention because it can make or break your business.
When it comes to logistics, there are three common mistakes that budding entrepreneurs should avoid.
1. Not keeping track of inventory
What quantity or amount of your products should you always keep in stock so they will be well within reach when orders come?
If you sell essential goods, the window of opportunity to regain your customers (should you run out of stock on hand to complete their orders) may be short.
If they like you, they might come back next week to see if you’ve restocked. Otherwise, you will lose some of them, especially those who need the products right away, because they will surely source them from other stores. But if you sell durable or non-essential items and runs out of stock when someone orders them, a lost customer might not return for months or even years.
Say, you are a pet supply store owner and a specific dog toy suddenly became popular on social media. You see a steady increase in interest but run out of stock over the weekend, so customers are expected to decide to check out other stores instead.
So, understocking can turn out to be a problem for start-up businesses.
On the other hand, overstocking can also be costly, as excess stock incurs storage costs. Over time, slow-moving or non-moving stocks may have less value and can become an added burden.
Keeping stocks at a healthy level will help you plan your purchasing strategies and reduce costs. To help you ensure you have enough inventory on hand to meet customer demand and streamline your operations, consider tapping a fulfillment service company that can handle multiple aspects of fulfillment, from picking orders to packing the products.
2. Not optimizing distribution
Imagine you're a small business owner selling handcrafted wallets and you have a bulk order from a couple who is set to get married next week.
Relying on less-than-truckload (LTL) shipping might seem economical, but you will have to wait for other shipments, potentially delaying your delivery. Chances are that your deliveries will arrive last minute — but the damage has been done, and you have a bridezilla giving you negative reviews as a result. This can hurt your business significantly.
It is therefore essential to take time to optimize your distribution method or partner with a reliable delivery trucking service that has key distribution points.
3. Not anticipating seasonal surges
Planning for day-to-day operations is essential for any business, but anticipating how different occasions or seasons can impact your business takes careful planning.
Failure to account for seasonal surges can lead to unpredictable demands, sales disruptions, and stock-outs.
Picture this: You’re a health supplement retailer. As early as October, you should already anticipate that when January comes, most people will be starting their wellness journey after all the excessive eating and drinking during the holidays. So there might be a demand for fitness-related products.
Come January and you don’t have enough stocks of your popular supplements, you may have to deal with the aftermath of negative reviews by disappointed customers, which may also deter potential ones.
You can maximize sales during peak seasons by proactively planning for seasonal surges even before they happen and having an effective restocking method that can help you plan ahead. How do you do this?
Find a reliable professional partner to help you level up your logistics game.
The complexities of logistics can often feel daunting. Instead of figuring out things on your own, you can partner with a reliable logistics solutions provider like Ninja Van Philippines, which offers a comprehensive suite of solutions to streamline your operations and help you avoid common logistical pitfalls.
The provider has equipment, such as the Dimension Weighing and Scanning, automated rollers, conveyors, and multipurpose mobile scanners, designed to provide an accurate movement of your inventory, allowing you to access a live view of your inventory with real-time updates. It also has an established nationwide network, including key distribution points of 40 warehouses from Batanes to Tawi-Tawi.
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