Logistics managers have arguably the most responsibilities of anyone in a company; their work directly benefits the business’s bottom line, but if they make a mistake the consequences are far-reaching and immediate. The duties of a logistics manager require an understanding of the supply chain, from the raw materials to the finished product, and the ability to keep track of many moving pieces at once.
Here are the top seven reasons that logistics managers have the most important role in business.
1) No Products, No Company
It’s a basic fact of business that if a trading company doesn’t have inventory, then they have nothing to sell. With nothing to sell, there are no profits and the company ceases to exist. With every incoming shipment of supplies, the logistics manager is fulfilling the most elementary function of a company and keeps the business alive.
2) Control of the Profit Margin
While at first it might not seem like logistics management has anything to do with profits, their work is in fact crucial to the company’s income. The logistics manager controls the supply chain, including sourcing, import duties, and cost of freight, and the right decisions in those areas are what make the difference between a company falling into the red or soaring into the black.
3) Reducing Operational Expenses
Everyone has experienced the feeling of triumph that comes with finding a good bargain while shopping. Now imagine that instead of saving a few dollars by finding that cheaper product or service, you saved your whole company thousands or millions of dollars. Good logistics managers feel this rush constantly as they reduce costs along the supply chain by optimizing routings, cost and filings, as well as by hunting out the best deals with carriers.
4) Go Global
Good logistics management is the key to international business. Any company looking to source and sell to international markets relies heavily on its logistics manager. By taking advantage of FTAs and special duty treatments, logistics managers can find the most cost-effective solutions and offset the financial impact of taking the business abroad.
5) Reverse Logistics
A huge percentage of buyers make purchases without the product directly in front of them; rather, they make the decision to buy based on guarantees and warranties. Whether the customer is an individual or another business, this form of transaction would never be possible without a logistics manager. When the logistics manager does his or her job well, the company’s reputation for reliability grows and customers spend money based on that reputation.
6) Company Collaboration
The logistics manager works with other departments in the company to make sure that accounting, shipping, customer sales, and order management are all smoothly integrated into the overall logistics of the business. Working with all those other people and divisions requires strong communication and highly developed interpersonal skills. Combine those with the organizational skills that form the basis of logistics management, and it’s clear that good logistics managers are well-rounded and talented people.
7) Give More to the Customer
Anyone can sell FOB, but by selling straight to your customers’ doorsteps and dealing directly with their companies, you can gain a significant advantage over your competitors. The work required to go that extra mile to attract customers and increase profits is the logistic manager’s responsibility- and it’s just one more area in which their role directly affects the reputation and bottom line of the company.
Overall, logistics management professionals are skilled organizers, negotiators, and decision makers who use their talents to coordinate essential operations in a quickly shifting business environment. Good logistics managers improve a company’s reputation, profit margin, and bottom line. At the end of the day, if you aren’t working with one, you’re missing out.