Introduction
Logistics management is an essential part of any manufacturing or trading organization’s success ratio; the basic function of logistics management is to supervise the movement of goods and services from one place to another by different means of transport such as sea, rail, air or road. Logistics management is a critical part of the supply chain management that plans, controls and executes the effective, efficient forward and reverse flow and storage of goods, services and necessary information between the point of origin and the point of destination, in order to meet the customer’s needs (Importance of Logistics, 2012). This article emphasizes the growing challenges of logistics management and how different logistic companies are increasing their business and capabilities by getting new contracts. Thanks to globalization, logistics management has gained a whole new dimension and several companies are hiring a logistic manager to provide expert advice on several complex logistics issues.
Announcement of Success
Norbert Dentressangle’s freight forwarding division; Norbert Dentressangle Overseas has witnessed a strong growth, just like several other freight forwarding/ logistic companies worldwide. Even its employees have doubled in recent times. Earlier, it used to be known as a haulage company, now it employs more than 700 freight forwarding workers in its fifty six global offices. If we analyze closely, we can infer that one of the biggest reason of this growth can be attributed to an increase in complexity of today’s global business environment. Because of high volatility in the price and supply of essential commodities such as oil, cotton, etc., it has become extremely difficult for manufacturing and trading companies to ship these commodities on their own. They need expert logistics managers who can guide them in selecting the best transport routes, haulage charges and mode of transportation. In fact, many companies have annual contracts with the specific freight forwarding companies for executing their shipments.
One of the best examples of acquiring new contract would be of DB Schenker, who received a six year contract of managing parts logistics for Brazilian aircraft manufacturer Embrarer. DB Schenker had recently moved to Heathrow, London and has been getting different kinds of contracts. For Embrarer, DB Schenker will also be handling the transport operations, including those for the emergency situations. According to Embrarer, it selected DB Schenker based on its transparent way of functioning and continuous improvement plans. Recently, DB Schenker secured a new contract from the world’s largest manufacturer of electric heating, the Glen Dimplex Group. We can infer from DB Schenker’s example that a logistic company needs to diversify its client portfolio. It needs to spread its arms and adopt a flexible way of functioning. One of the best ways is to have its offices in different parts of the world. The success of DB Schenker proves that flexibility is one of the key attributes that are vital for success in logistics management. Also, it is extremely important for a logistics manager to remain cost conscious and offer competitive rates to its customers, especially when it is vouching for long term contracts.
Conclusion
Although the basic idea of logistics management seems to be simple and straightforward, while practising, it is not that easy. There are a lot of complexities involved in it. In order to compete in today’s global markets, the most important challenge for a logistics manager is to remain flexible, cost effective and diversify their expertise in different areas such as air cargo.
References
Handy Shipping Guide (2014) Freight Forwarding Groups Celebrate New Contracts and the Inception of a Logistic Air Cargo Hub. Retrieved April 11, 2014 from www.handyshippingguide.com
PLS Admin (2012) The Importance of Logistics Management. Retrieved April 011, 2014 from info.plslogistics.com
