Few areas challenge businesses as much as bulk commodity logistics, and cement transportation logistics are no simpler than any other material. With nearly a quarter of the production costs for cement laying in sales and transportation, it behooves anyone dealing in it to optimize their logistics and cut as much waste and inefficiency as possible. In this article, we’ll discuss the basics of modern cement logistics and what you might do to improve the efficiency and efficacy of your logistics without breaking the bank.
To begin the discussion of optimizing cement logistics, we must first establish a basic understanding of what’s involved. Logistics often acts as another word for transportation, but there’s far more to it than that; procurement, production, distribution, and disposal logistics all carry their own set of issues to consider and values for rating performance—we’ll mostly be discussing distribution logistics here, including information, transportation, inventory/warehousing, and handling/packaging.
There are specific challenges associated with each of these areas in cement logistics:
- Information control, depending on your technical expertise and willingness to invest resources and time in purchasing and training staff in the requisite tools, can vary from extremely simple to optimize to very difficult.
- Transportation can be straightforward or extremely involved, depending on the nature of your business. If you find yourself in need of great flexibility in your transportation, this could involve extensive arrangements with outside transportation firms or maintaining your own fleet of vehicles and all the requisite staff and paperwork.
- Warehousing problems can be one of the bigger wastes for any company, on either end of the cement manufacturing chain. Controlling inventories and integrating the movement between stages of the logistics chain can be a monumental task even with advanced software at hand—something as simple as warehouse layout can mean the difference between a loss and a profit in tough years, yet this area is often overlooked when a company looks to improve its logistics.
- Packaging and handling is another area prone to minimal attention where great logistical gains and losses might be found. Poor or inefficient packaging solutions, ill-maintained equipment, and undertrained personnel can all contribute to unnecessary downtime and losses.
Many companies have found that outsourcing logistics to a third party specializing in their area results in far better outcomes. They have found that in-house logistics teams are either inadequate at bringing a company to its fullest potential or too expensive to train, equip, and maintain year-round; compared to the flexibility of 3PL. Third party logistics firms often offer better understandings of the myriad issues a company might find itself dealing with in each area of logistics, especially specialty problems such as navigation of local transportation situations, connections useful in streamlining logistics, integration of disparate logistics solutions between shipper and recipient, etc.
Problems such as unexpected large orders or sudden changes in regional shipping laws can catch a company dependent on in-house logistics in a bind, but the broader range of logistical tools and expertise found in a third party firm makes such issues moot. In-house logistics do have their benefits, but it’s worth considering every option when poor logistics threaten to eat up such a large portion of cement profits.
In the end, in-house and 3PL solutions both rely upon an attention to detail and buy-in to superior logistics efforts. If you commit your company to improving its logistics, improved logistics typically follow as a matter of course—that attention being half the battle.