The new consumer paradigm demands that companies minimise their costs in order to offer competitive services in the market. Good cost management goes beyond getting the product to the consumer, it is also a question of making better decisions on the use of resources, ensuring savings in the development of processes.
These expenses are of great importance in the financial activity of companies, where they account for the 6,5% of its sales. Within this percentage, 60% corresponds to transport-related tasks and 40% to storage tasks.
In addition, logistics costs represent between 15% and 20% of added value The cost of these costs is a key factor in a company's accounting system, demonstrating the relevance of these costs for industries. Therefore, reducing them must become a priority, offering lower prices to improve the company's competitiveness in the economic ecosystem.
What are logistics costs?
When we talk about these types of expenses, we are referring to all those costs that businesses incur in order to manage logistics. These include the acquisition of stock, its distribution and other tasks that make up the production, sale and delivery of goods.
In other words, they are all the logistical costs that a company incurs in the course of its business. If they are managed correctly, the quality of the work can be improved and a much more positive overall performance can be obtained in terms of organisation.
On the other hand, pursuing strategies that help us to reduce payments will influence all areas of the business, making practices more economical and efficient. In order to adapt to the demands of consumers, a competitive advantage must be found, and price-based pricing can be a highly beneficial methodology.
The aim is to reduce prices for customers and consequently increase the company's sales.
What types of logistics costs are there?
Managing the entire supply chain requires good management. We can establish 7 main logistics costs in a company, whose management must be addressed in order to optimise the activity.
Acquisition of stocks
This includes the purchase of raw materials that will be used for the production of goods destined for the final consumer. When these costs are mismanaged, the entire production and distribution process can be affected.
The maintenance of the inventory
As this is one of the main logistics costs of a company, it is of vital importance to have a good stock management to avoid possible errors in the activity, such as the loss of stock, and thus maximise the profits obtained.
Packaging of goods
Depending on the characteristics of the products being handled, different types of packaging will be required to ensure that they reach their destination correctly. The need to adapt to the circumstances of each order requires certain costs and they must be treated in such a way that a balance can be found between these, the sales value for the customer and their impact on the environment.
The transport of cargo
The distribution of products is the area that usually requires the most expenses. This includes fuel, vehicle maintenance, tolls, among others.
Taxation of logistics operations
Logistical processes are subject to taxation and, depending on the area in which they operate, represent higher or lower costs.
Financing emerging technologies
As society evolves, so must companies. By investing in technology, it is possible to keep pace with new paradigms as they emerge and adapt business activity to the demands of the market. In this way, you will become more competitive and innovative on the playing field.
The workforce
As in any sector, labour is an essential cost that must be managed. The need for talent in logistics is evident and skilled professionals should be a priority.
How to manage logistics costs well?
To reduce costs in the various areas mentioned above, we can adopt a number of practices, ensuring that the organisation's financial flow is more in control. Among the methods we can employ, we highlight the following:
- Good work planning.
- Investing in business-friendly tax planning.
- Process mapping.
- Automation of tasks.
In order to efficiently manage logistics costs, the use of technology is a valuable ally. At In Side Logistics we believe in the efficiency of processes to optimise all operations and offer the most profitable service for your company. We provide comprehensive logistics solutions through the best professionals, providing the knowledge, technology and innovation necessary to ensure that the competitiveness of your business continues to develop.
