‘Work smarter and returns will grow’

There is no doubt that improved logistics in the supply chain can increase return on investment, says Garth Bolton, joint CEO of Cargo Carriers. Bolton told FTW that too often companies remained in a rut due to past practice methodology. “This is something many logistics companies fight on a daily basis especially when it comes to the manufacturing industry. If we improve the logistics of the supply chain, then we will improve our return on investments, but to do that we must change the way we are doing business.” Using the example of a shoe factory in Port Elizabeth, Bolton said it was found that by changing the way the company had been doing business, it became more viable and found itself increasing its return on investment substantially. “To improve logistics efficiency, it did however require changing the way they were thinking and how they were operating. The reality is that asking a company to do that does require a leap of faith.” He said too often companies believed that to increase their return on investment meant squeezing the transport and warehousing sectors of the supply chain. “Most truckers are lucky if they get 10%. Many companies think if they want to increase their profitability they should try to get their transportation costs as well as warehousing costs down. And realistically you are not going to make a substantial increase on your return on investment if you just do that.” Bolton said by substantially changing the manufacturing aspect of the business as well as increasing sales a much larger increase on investment can be made.