In logistics, cost drivers are factors that significantly influence the expenses incurred during the procurement process. Some major cost drivers to track by procurement in logistics include:
1.𝗧𝗿𝗮𝗻𝘀𝗽𝗼𝗿𝘁𝗮𝘁𝗶𝗼𝗻 𝗰𝗼𝘀𝘁𝘀: 🚚🛳
Monitoring expenses related to shipping, freight, and transportation methods can help optimize spending.
2.𝗜𝗻𝘃𝗲𝗻𝘁𝗼𝗿𝘆 𝗰𝗮𝗿𝗿𝘆𝗶𝗻𝗴 𝗰𝗼𝘀𝘁𝘀: 📦
Keeping track of storage, handling, and holding costs associated with inventory management can identify potential savings.
3.𝗪𝗮𝗿𝗲𝗵𝗼𝘂𝘀𝗶𝗻𝗴 𝗲𝘅𝗽𝗲𝗻𝘀𝗲𝘀: 🏭
Analyzing costs related to warehouse space, labor, and equipment can aid in cost control.
４.𝗗𝗶𝘀𝘁𝗿𝗶𝗯𝘂𝘁𝗶𝗼𝗻 𝗖𝗼𝘀𝘁𝘀: 🚄
Optimizing order quantities and frequencies can lead to cost reductions in Distribution Evaluating expenses for packaging materials and methods can lead to more cost-effective choices.
These logistics costs are just the tip of the iceberg. But regardless of what costs you assess, you’ll need some method of putting your insights into action.
Predictive modeling and supply chain simulation offer a different approach by using historical data and algorithms to create models.
This can give you insight into key business drivers and opportunities to reduce total costs and make your finished products more attractive.
𝗔𝘀 𝗮 𝗣𝗿𝗼𝗰𝘂𝗿𝗲𝗺𝗲𝗻𝘁 𝗣𝗿𝗼𝗳𝗲𝘀𝘀𝗶𝗼𝗻𝗮𝗹:
❓️How do you monitor the cost of logistics?
❓️What are the drivers and your strategies for cost reduction?
✳ Hey there, it’s Onkar Gill
🔺 A Supply Chain Expert!
✅ Let’s work together to take the procurement game to the next level!”
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