Logistics management is related to the activities that involve outbound and inbound transportation management such as:
- fleet management,
- supply or demand planning,
- inventory management,
- logistics network design,
- order fulfilment,
- materials handling and,
- assembly (Lusch, 2011).
Furthermore, due to the rise of the retail and manufacturing industry, logistics management has been interlinked with customer services (Liu and Lyons, 2011). Logistics focus on improving the delivery network to cut down the delivery time and increase the level of customer satisfaction. Logistics play a crucial role to enhance customer relations and improved customer satisfaction (Carter and Easton, 2011).
Indicators of the relationship
One of the most import indicators of customer relationship is the cost of the product. The logistics management aims to reduce cost from suppliers considering quality and time which are the two other indicators. These indicators are implied in the logistics process using cheap raw material, cheapest transportation method, high production with low labour costs, low-cost storage and delivery (Ghoumrassi and Tigu, 2018). Logistics service quality is the result received comparing customers’ expectations with customers’ perception of service quality.
The quality of logistical service perceived by the client is the difference between the perceived service and expectation. Customer satisfaction depends on various factors such as:
- the perceived quality of service,
- customer mood,
- social interaction,
- customers’ associates’ experience and,
- other specific subjective factors (Meidutė-Kavaliauskienė et. al., 2014).
Customer expectations’ satisfaction is seen as a positive opinion of the client about the service after the service is performed. In other words, this is an evaluation of the results of the process.
Factors affecting customer relations
There are several aspects which affect customer satisfaction such as:
- Resource availability,
- operational performance and reliability,
- stock out frequency,
- fill rate and, orders shipped.
They are capacity based factors that impact the relationship with customers (Christopher and Peck, 2012). Sometimes stockouts don’t affect customer satisfaction until the point a customer demands it.
Demand forecasting is a very complex and challenging job and is not always accurate. Operational challenges include speed, consistency, flexibility and recovery (Christopher, 2017). The speed of delivery is a significant factor which influences customer service and often the patronage of customers.
The flexibility in logistics is the capability to handle and accommodate quick temporary changes to cater to the demands of the customer. Businesses usually use the concept of flexibility during the peak sales period by implementing small changes to the supply line to accommodate exponential demands (Tian et al., 2010).
Strategies to manage the waiting time of customers
Customer waiting is a crucial aspect of building a relationship. The lower the waiting time the better is the customer relation and higher the waiting time lower is the customer relationship (Carter and Easton, 2011).
However, there are a few strategies used by various manufacturing businesses that start with assembly line being flawless and application of automation for quicker processes and effortless cataloguing (Lai and Cheng, 2016). The customer relations are based on 3 main aspects;
- Timeliness: time taken to deliver the product.
- Quality and condition of order: quality of product delivered, type of packaging, and damages.
- Information: delivery of the right product, product information, real-time tracking and delivery information.
These aspects are all part of the logistics model. A basic logistics model is formed from different types of other models. The model uses a strategy where customers are provided with regular updates, live tracking of the product and efficient inventory process (da MotaPedrosa, 2012). The following model may also use a dedicated channel like helpline numbers and active chat rooms, to deal with the issues of the customers related to the delivery of the product (Jayaram and Tan, 2010). Waiting time of customers is a generic issue and remain solved only by using efficient methods of operations and dedicated infrastructure.
- Carter, C.R. and Liane Easton, P., 2011. Sustainable supply chain management: evolution and future directions. International journal of physical distribution & logistics management, 41(1), pp.46-62.
- Christopher, M. and Peck, H., 2012. Marketing logistics.Routledge.
- Christopher, M., 2017.New directions in logistics.In Global logistics and distribution planning (pp. 47-58).Routledge.
- Ghoumrassi, A. and Tigu, G., 2018, May. The impact of the logistics management in customer satisfaction. In Proceedings of the International Conference on Business Excellence (Vol. 12, No. 1, pp. 407-415). Sciendo.
- Jayaram, J. and Tan, K.C., 2010. Supply chain integration with third-party logistics providers. International Journal of Production Economics, 125(2), pp.262-271.
- Lai, K.H. and Cheng, T.E., 2016. Just-in-time logistics.Routledge.
- Liu, C.L. and Lyons, A.C., 2011. An analysis of third-party logistics performance and service provision. Transportation Research Part E: Logistics and Transportation Review, 47(4), pp.547-570.
- Lusch, R.F., 2011. Reframing supply chain management: a service‐dominant logic perspective. Journal of supply chain management, 47(1), pp.14-18.
- Meidutė-Kavaliauskienė, I., Aranskis, A. and Litvinenko, M., 2014. Consumer satisfaction with the quality of logistics services. Procedia-Social and Behavioral Sciences, 110, pp.330-340.
- Tian, Y., Ellinger, A.E. and Chen, H., 2010. Third-party logistics provider customer orientation and customer firm logistics improvement in China. International Journal of Physical Distribution & Logistics Management, 40(5), pp.356-376.
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