Outsourcing Vs Owning Logistics - What's the Best Business Solution?

#outsourcinglogistics #foodbusiness #logistics #ACvan #3PLLogistics

Outsourcing logistics has become the trusted choice for businesses today as the e-commerce boom has taken a center stage, especially in the aftermath of the pandemic. 

Businesses are no longer asking whether they need to outsource logistics as they know it's the future of doing business. Rather they are asking how to do it, where to do it, and to what extent. Most food businesses are trying to increase their logistics outsourcing by 5% since the pandemic hit the world. 

This is due to increased specialization and technology offered by the 3PL or 4PL logistics which reduces uncertainty and cost. 

This is especially true for newly established companies rapidly growing in their business. As they expand to newer outlets, they need to increase their warehousing facilities, inbound and outbound facilities. That means a huge burden of hiring an extensive team of workers and training them along with heavy investments to ensure smooth management of the supply chain. 

 

How Outsourcing Addresses Logistics Loopholes

Monthly expense of owning AC van
     
Driver salary fixed salary       20,000
Driver Other expenses OT, Diwali, PF, Leaves, Phone recharge, Uniform         2,300
EMI         12,000
Interest on Capital  8% interest - also have deducted Resale value from down payment plus insulation and ac fitting         1,300
Fuel CNG + petrol       12,000
Vehicle Insurance 25000 is annual premium         2,083
Maintainance  Tyres, Repairs, Oil, Filter, service         1,100
RTO Charges ad permit, speed governor, PUC, fitness, speed driving, no parking         1,150
Alternate transport vehicle breakdown/ driver absenteeism         5,000
Accident Repairs once a year factored expenses not covered by insurance         2,500
Van parking, washing deep cleaning for food safety and daily cleaning         1,200
GPS tracker               400
     
  Total        61,033

 

Monitoring your deliveries and assigning tasks to deliver boys and drivers and maintaining their workflow is the biggest hurdle for a business. When it's done in-house the logistics costs such as owning an AC van can be as expensive as 61,000INR per month. Please see table for reference.

Also, every domain or new outlet that opens has a specific need which has to be tackled quickly. These specific requirements can't be met by an in-house logistics facility. In such a scenario, outsourcing it to logistics companies that cater to your needs is the best possible outcome. 

With a dedicated logistics partner like Just Deliveries, you can significantly reduce the cost by 32%. You need not worry about maintaining your vans and catering to ever-increasing RTO fees which are the primary concerns of an in-house logistics facility. Most of these costs aren't recovered by businesses as they can't transfer them to the customers. 

You don't need to invest in a fleet manager to send 3 different AC vans to 3 different outlets, Just Deliveries' network of shared vans will do the job in no time with more efficiency and lesser expenditure. We take utmost care to reduce the cost by offering a shared van service for every AC van for at least 2 clients  

Our temperature-controlled vans ensure better storage with the least spoilage and timely delivery done on the same day. 

 

Logistics Cements Your Business Reputation

Apart from the basic reduction in cost and enhanced efficiency, outsourcing logistics has the added advantage of maintaining the quality and brand image of your company. 

Most companies think their worries end with the delivery. However, that's just the beginning of it. The real problem starts with reverse logistics which often goes unaccounted for if you have an in-house logistics facility. 

A logistics company is equipped to deal with the cost of reverse logistics. Moreover, they can easily scale up or scale down the services in minutes to accommodate immediate changes which are quite difficult for an in-house facility. 

Furthermore, in this digital world, a bad review for a slight delay in your orders can furnish the reputation of your company. Since 97% of consumers rely on reviews and ratings to opt for products from specific companies, this can be a huge setback. Nearly 74% of consumers shop from their tried and trusted companies. 

 

So to retain your customers and to attract new ones logistics is the key. The correct way to do it is to outsource it to a trusted logistics partner like Just Deliveries. 

Get in touch with us or ask for a quote to meet the demand of your food business. We have an experienced and dedicated team that manages the delivery fleet for efficient and timely deliveries of your goods. 

Businesses that use 3PL logistics partners have efficiently reduced their costs by 75% and 91% of them say that they have a happy relationship with their logistics partner. So, that's what we are aiming for! Some may say we are aiming high but it's the way we do it. We at Just Deliveries take logistics very seriously! 

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