The website uses cookies to improve the use of the website. We do not share the information we receive with third parties without your consent. By continuing to use this website, you consent to the use of cookies.
Operating costs in logistics
In logistics, any deviation – data error, ill-considered action, downtime – immediately increases costs. Many companies do not even notice where they are losing money until the amount becomes significant. Therefore, it is important to clearly understand where the losses come from and how to eliminate them in a timely manner. Today, on the LLC «FabriQuanta» blog, we will analyse the key reasons for and ways to reduce OPEX (operating expenses).
Redundant processes and micro-downtime
Unnecessary operations and short stoppages at each stage of the chain lead to increased processing time and reduced productivity. This manifests itself in duplication of actions, waiting between tasks, and unclear instructions. To reduce costs, it is necessary to conduct a detailed analysis of processes, eliminate irrelevant steps, and standardise the sequence of work. Clear regulations and measurable time standards allow hidden delays to be eliminated.
Incomplete transport loading and inefficient routing
Low vehicle occupancy and incorrect route planning increase delivery costs. The problem arises from a lack of dynamic planning, inconsistency between departments, and insufficient visibility of current data. To improve efficiency, it is necessary to implement route calculation systems that take into account cargo parameters, time constraints, and actual load (e.g., Route4Me). Optimising traffic patterns directly reduces transport costs.
Inefficient packaging and material overuse
Using the wrong packaging will make delivery and storage more expensive. Unsuitable sizes and materials will create unnecessary costs. To save money, it is worth choosing standard formats, optimal sizes and material usage standards, advise the experts at LLC «FabriQuanta». This will make each shipment cheaper and reduce losses.
Insufficient automation of routine operations
A large amount of manual work increases the likelihood of errors, lengthens the processing cycle and requires additional labour resources. This applies to data registration, document processing, labelling and checks. To reduce costs, it is necessary to gradually introduce automated input, scanning and control systems. Digitising regular tasks will ensure consistent quality and reduce time costs.
Unnecessary operations and short stoppages at each stage of the chain lead to increased processing time and reduced productivity. This manifests itself in duplication of actions, waiting between tasks, and unclear instructions. To reduce costs, it is necessary to conduct a detailed analysis of processes, eliminate irrelevant steps, and standardise the sequence of work. Clear regulations and measurable time standards allow hidden delays to be eliminated.
Incomplete transport loading and inefficient routing
Low vehicle occupancy and incorrect route planning increase delivery costs. The problem arises from a lack of dynamic planning, inconsistency between departments, and insufficient visibility of current data. To improve efficiency, it is necessary to implement route calculation systems that take into account cargo parameters, time constraints, and actual load (e.g., Route4Me). Optimising traffic patterns directly reduces transport costs.
Inefficient packaging and material overuse
Using the wrong packaging will make delivery and storage more expensive. Unsuitable sizes and materials will create unnecessary costs. To save money, it is worth choosing standard formats, optimal sizes and material usage standards, advise the experts at LLC «FabriQuanta». This will make each shipment cheaper and reduce losses.
Insufficient automation of routine operations
A large amount of manual work increases the likelihood of errors, lengthens the processing cycle and requires additional labour resources. This applies to data registration, document processing, labelling and checks. To reduce costs, it is necessary to gradually introduce automated input, scanning and control systems. Digitising regular tasks will ensure consistent quality and reduce time costs.
Losses due to inaccurate data and weak analytics
If the data is incorrect, it leads to erroneous management decisions: routes are poorly planned, stocks are incorrectly formed, and delivery times are violated. Without good analytics, it is difficult to spot problems and predict risks. To fix this, you need a unified database, regular information checks, and tools for real-time process analysis. This helps you work more accurately and efficiently.
Shortcomings in working with contractors
If the terms of working with carriers and operators are not transparent, this leads to unpredictable costs, missed deadlines and a decline in service quality. This is most often due to weak control, unclear KPIs and poor communication. To remedy the situation, clear standards need to be established and results monitored regularly. This will make logistics more stable and predictable.
If the data is incorrect, it leads to erroneous management decisions: routes are poorly planned, stocks are incorrectly formed, and delivery times are violated. Without good analytics, it is difficult to spot problems and predict risks. To fix this, you need a unified database, regular information checks, and tools for real-time process analysis. This helps you work more accurately and efficiently.
Shortcomings in working with contractors
If the terms of working with carriers and operators are not transparent, this leads to unpredictable costs, missed deadlines and a decline in service quality. This is most often due to weak control, unclear KPIs and poor communication. To remedy the situation, clear standards need to be established and results monitored regularly. This will make logistics more stable and predictable.
Personnel issues: turnover, training, motivation
Frequent staff turnover, lack of training, and low engagement lead to more mistakes, slow down work, and increase the workload on the team. The result is financial losses. To reduce costs, it is worth systematically training employees, giving clear instructions, and coming up with ways to motivate them. A stable team works more accurately and quickly, which directly reduces OPEX.
Practical tools for reducing OPEX
It is possible to reduce operating expenses by making processes transparent, regularly monitoring work, and using accurate data. After that, it is important to implement automation, standardise operations, control contractors, and optimise logistics.
Advice from LLC «FabriQuanta»: a systematic approach with unified analytics, constant monitoring, and measurable indicators helps reduce costs, stabilise work, and reduce the impact of errors on your income.
Frequent staff turnover, lack of training, and low engagement lead to more mistakes, slow down work, and increase the workload on the team. The result is financial losses. To reduce costs, it is worth systematically training employees, giving clear instructions, and coming up with ways to motivate them. A stable team works more accurately and quickly, which directly reduces OPEX.
Practical tools for reducing OPEX
It is possible to reduce operating expenses by making processes transparent, regularly monitoring work, and using accurate data. After that, it is important to implement automation, standardise operations, control contractors, and optimise logistics.
Advice from LLC «FabriQuanta»: a systematic approach with unified analytics, constant monitoring, and measurable indicators helps reduce costs, stabilise work, and reduce the impact of errors on your income.
Contact us
Email
Addresses
Ukraine, 61046 Kharkiv region, Kharkiv, Nemyshlyansky district, Alexandrovsky avenue, 2-A
© All Rights Reserved. 2024 "FabriQuanta" LLC