Outsourcing of the distribution center (DC)
Outsourcing of the distribution center is a new trend
Transfer of logistics to outsourcing allows retailers to significantly reduce costs and optimize the distribution system at all stages. Correctly organized RC allows you to significantly improve the profitability of the business. The speed of processing the goods and the accuracy (quality) of the fulfillment of internal instructions from the supplier and the recipient are very important for the work of the DC.
The main functions of the DC are:
- accumulation in a short time of goods from suppliers, acceptance, storage, sorting, bundling and shipping of goods.
- DC, like the EDI-center, receives and generates all information about the range and quantity of goods, accepts the delivered goods, stores, completes and continuously distributes the products between the retail chains.
Organization of work through the DC allows:
Reduce the cost of delivery by increasing the supply
Improve logistics services to clients in the region (to provide faster and full satisfaction of their requests), which will help improve the situation in the company.
The use of the DC is more suitable for companies that have a branched network or a large range of goods (FMCG, DIY, Fashion retail chains, pharmacy chains, fast food chains, petrol stations, etc.). As a result, warehouses from the place for physical storage and movement of goods are transformed into centers for the rationalization of commodity flows.
The organization of logistics through distribution centers has a number of advantages:
- Expansion of the store’s retail space to 30%, by transferring warehouse space to retail space
- Increase in income up to 10% of the turnover of the retail center due to an increase presence of goods on store shelves
- Receiving from the suppliers of additional discounts from the cost of goods when delivering goods to the DC
- Increase of turnover and controllability of commodity stocks;
- Ensuring availability of goods on store shelves during peak holiday periods sales and periods of promotion
- Ensuring the quality of goods through the organization of a centralized quality control services
- Reduction of transportation costs due to simplification and reduction of costs for network interaction with suppliers
- Preparation of goods for fast laying on store shelves
To ensure the efficiency of the DC, a systematic approach to the organization process is necessary: established warehouse processes, route optimization, cross-docking, Pick-by-Line, efficient operation of WMS and the entire staff of the company.
The company Business Group Logistics will become for you the ideal partner for outsourcing the distribution center, professionally having adjusted all business processes taking into account the individual characteristics of your company and its field of activity.