Why Your Business Wouldn’t Survive Without The Logistics Industry
Many people know that the logistics industry is the backbone of every single business in the world. Truck drivers facilitate the task of carrying goods from one location to another. And they often work to extreme deadlines.
But the sad truth is that they are the unsung heroes of this world. When you send a parcel to a destination in another country, you won’t think about how it gets there. Nor what benefits and incentives there are for logistics staff to get the job done. All you care about is when it will get there and how much it will cost.
In today’s blog post, I explore the importance of logistics to the business world. I also uncover some of the hurdles that some transport firms are finding hard to overcome. By the end of this blog post, you will have a better understanding of logistics. And the challenges that the industry must face on a daily basis.
Why does the business world need logistics?
In some ways, the question is the same as “why do we need to breathe air” – of course, the answer will be the same. To survive! If you run a company that sells products to its customers, you need to get those products shipped to their recipients somehow.
Does your organisation offer services? If so, logistics firms help by delivering the infrastructure necessary to provide your service.
For instance, let’s say you run a web design agency. Logistics help to deliver network equipment to telecoms companies. Those firms can then get you connected to the outside world so that you have high-speed Internet access. If that vital piece of the puzzle were missing, you wouldn’t be able to go online. And you’d soon be out of business!
A supermarket wouldn’t be able to sell fresh food to its customers if it couldn’t get those items delivered in a timely fashion. You wouldn’t be able to buy petrol for your car if the filling station couldn’t receive regular supplies of fuel.
As you can see, the logistics industry really is the backbone of all businesses!
What are the hurdles faced by the industry?
In a nutshell, transport firms have many challenges and obstacles they need to overcome on a daily basis.
Here is a summary of the most common hurdles faced by the industry:
- Lack of qualified truck drivers
One of the most common careers within the industry is truck driving. Those drivers operate heavy goods vehicles for hundreds of miles. All to ensure that you get your consignments delivered on time!
You may not know this fact, but there is a shortage of qualified truck drivers! The industry is crying out for more people to get trained and licensed as long-distance truck drivers.
One common complaint heard from transport firms is how current drivers work too much. And how they seldom get to spend quality time with their families. But why is it that there are too few drivers working in the industry?
It turns out there are a few reasons. But the two main reasons are as follows:
- People don’t know about the benefits (especially the salary) they get as a truck driver; and
- Lack of training vendors. There isn’t a huge amount of good quality training providers for the transport industry!
- Rising operating costs
The bulk of all work done by logistics firms is by road and air. They have to pay for costs such as vehicle and aircraft maintenance, fuel and security auditing. The bad news is that all of those tasks don’t come cheap!
In fact, increasing fuel costs (often due to high taxes) mean that logistics firms often levy a fuel surcharge on their prices. Customers aren’t too happy about paying these surcharges, as you can imagine. But they understand that companies cannot absorb those extra costs and so are willing to cover them. For many, turning to a truck factoring company is a way for them to keep their business moving forward.
We live in a world where it seems that governments everywhere are not making life easy for companies in the logistics industry.
- The Internet
Believe it or not, the World Wide Web is also a problem for hauliers and transport companies! Tech-savvy consumers seek out the cheapest deals online for their logistics needs. That means firms need to charge less to compete with others that only offer Internet-based services.
If you run a transport business, you’ll know all too well how these hurdles can affect your bottom line. But what can the industry as a whole do about them? The good news is there are a few options available. They are as follows:
Establish more truck driving schools
To fill the increasing staff shortage gap of qualified drivers, there is a need to open up more truck driving schools. You might not know this, but in some cases, candidates have to travel up to 100 miles to their nearest training provider!
It makes sense to set up truck driving schools in areas populated by logistics companies. Or, in the least, areas where there is a high population such as in major towns and cities.
Stick with used vehicles instead of new ones
One of the biggest expenses for any transport firm is its fleet of trucks. Each vehicle will cost five to six-figure sums to buy. But obtaining quality used vehicles can ease a company’s cash flow burden.
Websites like Auto Trader Trucks can help you to facilitate this task. That’s because they can connect you with firms selling used trucks and trailers.
Before you hand over any money for them, make sure you do a thorough inspection of each vehicle. The process is akin to buying a used car.
You will need to check that it’s got a comprehensive service history and that it hasn’t got any significant problems. You will also need to confirm that the trucks you are buying are legitimate.
Consider using eco-friendly transport methods
I’ve read with interest how some big-name logistics firms are testing electric vans. They used them for deliveries in urban areas. These EVs are zero-emissions vehicles that usually attract no road tax. And the insurance is cheaper than for their diesel brothers and sisters.
It’s also possible for businesses to receive grants towards the cost of greener vans. Avoiding air transport is another way to lower operating costs and your carbon footprint. Some logistics firms like Stobart in the UK use freight trains to deliver goods without spending lots of money on fuel.