Your distribution methods might not be as efficient as you think.
If you haven’t taken a close look at them in the last five years, now is the time.
Watch the video below to discover the reasons why.
Time to Reevaluate Your Distribution Network
If you haven’t reviewed your distribution network in the last five years, it’s time to take a closer look. Distribution networks are intricate systems with numerous moving parts, from stockholding locations to various transport modes. Even minor adjustments can lead to significant improvements in efficiency and cost-effectiveness. Regular evaluations are essential to ensure your network remains capable of supporting your business’s growth and adapting to ever-changing market conditions.
Mergers and Acquisitions: A Catalyst for Change
Mergers and acquisitions often serve as catalysts for reevaluating and restructuring distribution networks. When two companies merge, their distribution networks must be integrated and optimized to achieve the desired synergies. This process involves a thorough assessment of the combined network’s efficiency and exploring opportunities to enhance its performance. Whether your company has recently undergone a merger, is considering one, or simply needs to reassess its current strategy, now is an ideal time to review and refine your distribution network.
Adapting to New Channels and Services
The rapid rise of omnichannel distribution and the introduction of new service offerings, such as home deliveries, have dramatically transformed the way companies operate their distribution networks. Traditional models that once supported single-channel distribution may no longer be adequate in meeting the demands of today’s multi-channel environment. Companies are increasingly discovering that their existing networks require modifications or expansions to handle the complexities of fulfilling orders across different channels effectively. This shift often necessitates the development of hybrid distribution strategies to manage the diverse needs of various channels.
Rising Costs and the Need for Efficiency
Fluctuations in costs, particularly in areas like freight and warehousing, can have a profound impact on the efficiency of your distribution network. For instance, recent spikes in ocean freight costs have forced many companies to reconsider their import strategies, potentially leading to changes in ports of entry and overall supply chain configurations. Regularly reviewing your network in response to these cost changes is crucial for maintaining competitiveness. It ensures you’re not only controlling expenses but also optimizing your operations in a market that’s constantly evolving.
Related articles on this topic have appeared throughout our website, check them out:
- How to Operate Your Distribution Truck Fleet at Less Cost
- The 7 Principles of Warehouse and Distribution Centre Design
- 7 “Costequences” of Distribution Network Misalignment
- Do You Know the Signs of Poor Distribution Network Design?
- Spotlight On: Robots In Distribution Centres
Editor’s Note: The content of this post was originally published on Logistics Bureau’s website dated July 19, 2023, under the title “Why Should You Review Your Distribution Network?“.
