Challenges of Efficient Logistics

Logistics is a high cost - low margin business. Developing state of infrastructure, low ratio of high speed roads, pervasive time wastage in paperwork and documentations at various check posts and varying tax structure prevailing in various states add to the challenges of an already difficult business. 

According to industry experts and researchers, a truck wastes anything between 24 to 48 hours per week at check posts. The annual tax outgo on a vehicle costing Rs. 13.5 lakhs is approximately Rs. 3.5 lakhs - including excise duty on fuel. 

While these issues are staggering both for a veteran or new industry entrant, the biggest challenge is in managing information. Whether setting up a new competitive business or fine tuning an existing operation for quality or efficiency, information management becomes the most resource consuming and complex activity. 

 

The ten challenges those are faced uniformly by all industry participants are -

 

  • Repetitive and frequent phone calls to drivers to ask their present location and status
  • No adequate mechanism to verify the correctness of the information received from drivers
  • Frequent instances of accidental loss due to undisciplined, rash or fatigue driving
  • No proper means to enforce duty timings and control rest break duration
  • Repeated phone calls to and from clients for informing status of shipments
  • Slow law enforcement in remote areas makes it nearly impossible to recover a stolen truck in time
  • Extra-ordinarily long turnaround time for insurance claims for stolen truck and cargo
  • Frequent unauthorized personal usage and loading of company owned trucks by employees
  • Unavailability of organized data on day to day operations for analyzing and fine tuning the operations