Logistics in FMCG Date : March 13, 2021
Logistics in simple words refers to the overall process of managing resources from acquisition, storage and transportation to their final destination.
Fast-moving consumer goods (FMCG) are products that sell quickly at relatively low cost. FMCGs have a short shelf life because of high consumer demand. Since these goods have short life and in high demand for customers, they have to be transported at a faster rate. Logistics therefore plays a vital role. Fast Moving Consumer Goods (FMCG) are closely associated with end-users. The volume of products for shipment in this industry is quite large. As long as the distribution channels are wide, the role of Logistics also become crucial and important.
How FMCG can be benefitted with Logistics
- The Just-In-Time Inventory: This is a strategy that manufacturers utilize to increase efficiency and decrease waste by receiving goods only as they are needed in the manufacturing process, thereby reducing the cost of inventory. This prevents the hoarding of unwanted items. As the stock reduces, the order for new materials will be placed automatically.
- Demand and Supply Synchronization: the technology enables the company to determine its material needs by analyzing its demand and supply. The company then plans to acquire those materials through the logistics performance metrics reporting solution for logistic visibility for FMCG industries.
- Implementation Process: This process includes supplier management. The executives set up a supplier of a given type of material via logistics e-documents. The supplier is given specifications of the needs of the business. A new Supplier will be brought into the processes by logistics performance metrics if in case the supplier is unable to meet the demands of the business.
- Transportation Process: It covers all the aspects of how FMCG products are transported. The logistics e-documents include the complete arrangement and control of transportation. The logistics oversee the modes of transportation and provide for the most reliable and cost-effective ones, which aid to logistics performance metrics reporting solution.
With all the above points it is important to note the vital role that logistics plays in FMCG Sector. FMCG sector becomes successful only when it reaches the end customer and for Logistics is an inevitable part.