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How to Measure Efficiency: Going Beyond Cost Per Service 

22-05-2024
Logistics Illustration with the words "How to Measure Efficiency"

Going Beyond Cost Per Service 

In the world of logistics, the cost of a service is just the tip of the iceberg. For logistics, procurement, and supply chain managers striving for peak operational efficiency, it’s vital to consider both direct and indirect costs. Let’s dive into why a comprehensive view of logistics costs—not just the euros spent on services—is essential for true efficiency. 

Understanding Total Logistics Efficiency 

  1. Direct Costs: Direct costs in logistics are straightforward and typically include transportation fees, warehousing, and packaging. These are the costs most managers track meticulously. However, focusing solely on these can lead to a narrow view of the broader operational landscape. For instance, choosing a lower-cost freight option might seem beneficial until you consider the potential for delays and the associated downstream costs.
  2. Indirect Costs: Indirect costs can be trickier to pinpoint but are equally impactful. These include the administrative time spent managing logistics operations, the labor costs involved in sorting out supply chain disruptions, and the opportunity costs of delayed deliveries. In my early days in logistics, I quickly learned that a delayed shipment doesn’t just cost in terms of customer satisfaction; it also ties up capital that could be used elsewhere in the business, amplifying the true cost of logistical inefficiencies.

Measuring Efficiency Beyond Cost Per Service

Efficiency isn’t only measured in euros saved but also in the smoothness of your logistics operations: 

  1. Time as a Metric: Time is a gold standard metric in logistics. Reducing time wastage—from shorter turnaround times to faster market entry—can often yield better financial savings than cutting direct costs. Implementing a robust tracking system that pinpoints time delays helps in refining processes and enhancing efficiency.
  2. Technology Integration: Modern logistics isn’t shy about embracing technology. From RFID tracking to sophisticated logistics software, technology drives efficiency. Platforms like MyDello leverage advanced algorithms to analyze more than 300 partner routes and find not only the best partner, but the best elements from each route, from each partner. Creating a completely unique freight quote that is both instant and guaranteed across multiple modes, transforming the traditionally time-consuming process of cost comparison and decision-making.
  3. Employee Involvement: Efficient logistics systems also depend on the people running them. Engaged employees who understand their roles in the logistics chain are less likely to make costly errors. Encouraging team feedback on processes and fostering a culture of continuous improvement can lead to significant gains in operational efficiency.

 

Spotlight on MyDello: Enhancing Operational Efficiency 

MyDello isn’t just another digital platform; it’s a solution designed by logistics experts who understand the nuances of the industry. Our platform simplifies the complex process of obtaining freight quotes, managing shipments, and tracking deliveries, ensuring that you have more time to focus on strategic business decisions.  

 

  1. Enhanced Interface and Multi-Stakeholder Access: Understanding the necessity of a seamless, informative dashboard, MyDello has integrated features that enhance user experience while accommodating the needs of various stakeholders involved in the logistics process—shippers, suppliers, and receivers. This approach significantly boosts efficiency, reduces delays, and minimizes errors in communication and logistics handling. 

 

Illustration of how Supplier Direct Works

 

Introducing the Supplier Direct Feature

Our innovative ‘Supplier Direct’ feature streamlines logistics management by enabling suppliers to initiate shipments directly. With this functionality, you no longer need to share your account login details, maintaining the integrity and security of your information. Here’s how it works: 

  • Push Notifications: Suppliers can push shipment details to your dashboard, where you can review and take action—accept, reject, or modify—based on your specific requirements. 
  • Reduced Administrative Burden: This feature cuts down on your administrative tasks by shifting the entry of shipment details to suppliers, speeding up the entire supply chain process. 
  • Enhanced Operational Efficiency: By simplifying interactions between you and your suppliers, the Supplier Direct feature supports a leaner operational model, ensuring that you retain full control over every step without sacrificing privacy. 

If you’re interested in enhancing your logistical operations with more autonomy and less hassle, email our team to learn more about implementing the Supplier Direct feature in your logistics strategy. 

  

What Truly Lies Beyond Cost Per Service 

Improving efficiency in logistics is more than just cutting costs the true savings are found beyond cost per service; it’s about smarter management of every element of the supply chain. With MyDello, you gain a partner who not only provides the tools to measure and enhance efficiency but also understands the intricacies of global shipping. Embrace the change with MyDello and redefine your logistics operations. 

Ready to redefine efficiency in your logistics operations?  

Sign up for MyDello today and see how our solutions can transform your business from the ground up. It’s not just about saving money—it’s about elevating your entire logistics strategy.