‘Efficient logistics builds efficient nations’

INDUSTRIALISED NATIONS and developed economies spend billions of dollars on freight transportation, communication and management of logistics processes. Clearly improvement in logistics operations in a country, and by implication the logistics of a company, can ultimately increase a nation’s efficiency and make an important contribution to the economy.
That’s the view of Beverley Kujawa in her thesis undertaken for her D.Com (Logistics Management) at RAU University.
“South Africa too would benefit from improved logistics practices,” says Kujawa, “particularly considering the country’s export-led growth strategy. This would make products more competitive especially over the long distances between the country and its trading partners.
“As South Africa becomes increasingly involved in the global economy, local manufacturers are being exposed to increasing pressure to be more competitive. Manufacturers, driven by the need to conform to world standards and contain costs, must consider the outsourcing of their logistics requirements,” says Kujawa.
By outsourcing logistics activities, increased efficiencies, economies of scale and expertise can be leveraged as this is the core competence of the logistics service provider. At the same time this allows the company to focus on its areas of core competence.
“Logistics outsourcing thus holds great potential for a company to increase its competitive advantage and profitability. However, in order to reap the potential benefits of logistics efficiency through outsourcing, it is critical that the process is executed properly and with due diligence, and that the service provider is viewed as a partner in the company’s supply chain processes.”