TRANSPORTATION LEAD TIME

The lead time is a very interesting topic.

Lead time mainly state about the time reqd to dispatch materials from one place to another.

To make customer satisfy the following need to make a standardize .

For Ex :-

From place A to B normal transit time reqd of 5 days , but org got some new transporter where the lead time reduces to 3 days, on 1st instance customer become delightful but need to maintain the standards.

If on 2nd instance if the vehicle is not available from the express service, customer will be annoyed and will start complaining.

Always remember its important to retain customer than finding a new one.

A standard time sets in the mind of the customer, before changing a transporter always check his capability.

On a single instance cannot be a example, on a new transporter always want to grab opportunity, study the normal lead time , make a note on route map , if the instance is possible on every sequence then only opt for the same otherwise stick to basic.

Sumit Chatterjee

Senior Supply Chain Manager

Dream Bake Pvt Ltd ( Brand Winkies , Mainly into package Cakes division )

More than 10 + years’ experience in FMCG Supply Chain

CII Certified Supply Chain Management Professional

MBA Marketing & Finance from Future Business School

Post Graduate Diploma in Logistic & Supply Chain from St Xavier’s

Post Graduate Diploma in Export & Import Management from ICFAI University

Comments

FREIGHT COST CALCULATION

The important question is to how to calculate freight cost ? The distance from x to y certain transporter want x amount . For Ex take certain parameters before negotiation PER TRIP FREIGHT Kolkata to Guwahati present mkt rate Rs 60 k Distance 1010 km Approx.3.5 mileage so Diesel 78 / per liter Diesel costing approx. :- = 1010/3.5 = 288 ; 288 *78 = 22.5 k Standard time :- 5 days So Driver Salary 20 k , per trip approx. 5 k Maintenance monthly 10 k, per trip approx. 2.5 k EMI :- 20 k monthly, so per trip 5 k So costing coming around 35 k Misc 5 k Approx. 40 k will be grand total On per trip transporter is charging 20 k profit . If the homework is done , you are in a position with the parameters to negotiate and deal with a transporter . Its very much important to negotiate on the right path. Also keep in mind payment terms , return load and market demand and supply for the same. For ex if there is no return load transporter will charge retu...

FREIGHT COST REDUCTION ( Own or Hired )

The challenges in every day life of logistics dept is to reduction of freight cost. So the homework need to be done on How ? Lets took example If it’s a daily route somewhat near to warehouse its better to use own or dedicated vehicle Good Service 24*7 availability Proper coordination If there is some return goods can be managed on same freight Points known so less chance in delay Only thing need to consider if paying on per km , need to calculate on variables ( Fuel Price Escalation , Maintenance etc ) But on the same scenario If it’s a far of place & frequency is less Up Down costing will be more Long distance time coordination will be a issue Frequency is less so liability will also be less. On any scenario need to calculate, but always if the service is own its better but on serviceability point not on cost always . Sumit Chatterjee Senior Supply Chain Manager Dream Bake Pvt Ltd ( Brand Winkies...

FREIGHT COST ( TRANSPORTATION RATE )

The world is behind cost reduction, for any organization freight cost reduction is a challenge. The stereo type thinking is Search New Transporter Negotiating with the transporter Just think from a transporter point of view , with the competitive market the transporter is also doing business So thinks some point and apply :- Had a discussion with the transporter and assure him that you are the single vendor Don’t negotiate with rate, just make a friendly relation Make the concern part of your team Make sure the payment do not get delayed Ask him to get best rate the concern do not need to keep large margin, make a system payment will be be made as soon the materials get safely delivered, give stress on scan POD Don’t concentrate on transportation agreement clause Don’t concentrate on credit period Benefit:- Vendor become loyal Vendor will not search for other alternatives Vendor get develop and you will get good service. ...

Divine Logscm

Search This Blog