Logistics and Transportation 

Logistics and transportation are inseparable aspects. Logistics covers a broader field while transportation only includes one function: moving products from one location to another. Nevertheless, transportation is one aspect that plays an important role in logistics activities. According to the World Bank, it dominates (40%) logistics costs in Indonesia. 

Logistics Transportation Challenges

Logistics transportation is not free from various challenges. What are the challenges faced by logistic players related to transportation? 

Cost Optimization

Companies allocate a large budget for the logistic transportation system. Generally, the costs spent for fleet costs, driver salaries, fuel, and vehicle maintenance. 

Realistically, the company has several options to reduce the budget. The solution can be implied by prioritizing one aspect over others. For example, when a company has to choose between limiting the number of deliveries per day or reducing the number of fleets. That’s why suppressing the transportation budget becomes a complex challenge to solve. 

Limited Human Resources 

Human resource is a crucial role in logistic transportation. It’s undeniable that being a truck driver is risky. That’s why the recruitment process can’t be hasty. However, it causes an insufficiency of drivers that become another problem in logistic transportation. Companies must be selective to hire competent drivers. If traffic violations, delivery errors, and product smuggling happen on the field, it will affect the company’s credibility in front of consumers and partners. 

Instant Delivery and Real-Time Tracking 

In this “instant” era, logistic transportation systems must implement quick shipments and real-time tracking to meet consumer needs. The need for visibility across the supply chain seems to be increasing. Visibility aspects include tracking shipments, plus ensuring that deliveries follow the correct route plan according to schedule. Delay notification from delivery activities could also provide a sense of consumer security. 

Based on research from several companies in Indonesia which are members of the Indonesian Logistics and Forwarders Association (ALFI), delivery time is as important as transportation costs. 31% of respondents choose delivery time as the most important indicator in logistics.

Read More: Get to Know The 3 Process of Delivering Goods to The Hands of The Customer  

Environmental Sustainability 

Environmental sustainability is one of the most criticized issues around the world. Unsurprisingly, many companies face much pressure from both government and society to adopt an eco-friendly system. They can apply several methods to reduce carbon emissions, such as optimizing route & load, increasing engine capability, creating emissions reports, and using alternative fuels. Maximizing the business scale and reducing carbon emissions are two opposite things. Nevertheless, the company’s ability to demonstrate vehicle usage & fuel transparency becomes an alternative solution to maintain environmental sustainability. 

Read More: Utilizing Technology for Route Management System 

Technology provides solutions in various fields, no exception in logistics. There is a lot of planning and optimization that can be done to improve manual activities. As expected, the company needs to be literate digitally & think critically in finding problems and points that need to be optimized, in order to utilize the right system that can answer various needs. 

Employees should upgrade their digital literacy so that the company can keep up with the times. It’s undeniable that technology will take many roles in the future. 

Advotics provides various solutions to optimize your logistics transportation needs such as Delivery Planning System  to manage your vehicle’s load capacity, Route Management System to find the most optimal route, and Vehicle Management System to monitor your vehicle operations up to granular level. 

Click here to find more about Advotics products.