International logistics: costs and practical advice

Logistics are still often considered a necessary evil. The result: this field doesn’t get the attention it deserves. The processes - often managed by several people - are fragmented, which makes it difficult to see how important the logistics chain is. However, effective organisation of your logistics can generate a competitive advantage, particularly in an international context. It will enable you to reduce your costs while ensuring optimal service.

Here are the 5 factors which determine the cost and effectiveness of your logistics process.

Transport

You can choose from a wide array of modes of transport for your international goods transport needs. We describe the main ones in this overview.

Tip: conduct an in-depth analysis of the different modes of transport – even if some appear uninteresting at first glance – by listing the benefits and drawbacks of each option.

Loading and unloading

Don’t forget the activities required before and after the transport. Your choice will depend to a large extent on the volumes handled and the infrastructure in place.

Tip: transfer costs increase when you combine several modes of transport, such as piggybacking. Always select the most cost-effective route for your merchandise.

Transport time

Take into account the damage and losses which occur during transport. Unforeseen circumstances can also increase the transport time.

Tip: use outside carriers, agree to precise transport times and negotiate compensation in the event of delayed delivery.

Inventory

If you have to keep an inventory, evaluate the cost (warehouses, risks, etc.) based on the level of service you want to offer your international customers.

Tip: consider acquiring inventory management software to have an exact, real-time view on the availability of your products and spare parts.

Internal operation of the company

These are all the direct and indirect costs (e.g. staff, digital tools, financing) related to the organisation and tracking of your logistics processes.

Tip: reduce your salary costs, your processing times and risk of human errors by implementing advanced automation. Robotic Process Automation (RPA) will enable you to make significant productivity gains.