Elastic logistics allow companies to operate supply chains more efficiently in the face of fluctuations, upscaling and downscaling or seasonal activity. Until quite recently, lean or just-in-time business models have predominated in the warehousing and logistics sectors but while both models function well for one end of the chain (manufacturing or value added processes) and the other (last mile) the middle section, where logistics is sited, isn’t well served by either model.
Enter elastic logistics, which focuses on the variables: sailing and flight schedules, carrier space or lack of it, road and weather conditions, seasonal demand variations. One of the most attractive things about elastic logistics is that they are an entirely technical solution They call on software, tracking technology and sophisticated data crunching to produce ‘visibility’ – evidence of where the supply chain needs to stretch or shrink according to demand.
Elastic logistics and warehousing
The interplay between supply and demand has tipped far in favour of demand. E-commerce, multi-channel marketing, warehouse management software and automation processes in picking and packing all force warehousing and logistics further towards supply-led decision-making. This endless expansion and contraction of warehouse operations based on supply, allows for more reliable financial control.
Who needs elastic logistics?
It’s an approach that is particularly favoured by the retail, pharmaceutical and fashion industries because it allows them to utilise infrastructure such as third party logistics and on-demand warehouse rental to cope with market fluctuations. One way to categorise the sectors that find elastic logistics useful is to say that they tend to be customer-centric.
While this makes it sound like a logical process for all industries, elastic logistics aren’t necessary where price fluctuations are rare, where demand is largely stable and where product is difficult to transport: mining and quarry products and large-scale agricultural outputs are obvious places where elastic logistics aren’t particularly useful, because they aren’t substantially customer led.
Elastic logistics in the warehouse
Elastic logistics processes include: managing incoming and outgoing deliveries through a single dashboard to improve efficiency and data capture. This also simplifies administration of delivery operations, allowing the user to recognise a rise in costs rapidly and respond through looking at alternatives both in terms of cost and fulfilling customer need. Enhanced visibility through better software allows better recognition of current stock levels, allowing greater customer satisfaction and more responsive marketing by rapidly removing items from e-commerce visibility if stocks fall too low and just as rapidly reinstating them when new stock arrives. This simplified warehouse planning approach handles incoming materials quickly and allows fast, accurate responses to customer queries. Ideally, elastics logistics also automate the dispatch process, basing each decision on preferences, goals and costs, so that shipping or freight processes can be scaled instantly.
All these processes aid customer retention, which is a primary goal for most industries. Used strategically, elastic logistics create greater sustainability by allowing warehousing and logistics teams to deliver against deadline whilst minimising costs.