It is of common knowledge that logistics operation is the spine of any business that involves physical goods. We’ve also heard that logistics is extensive, challenging, requires planning, experience, etc. and are aware of the terms inbound and outbound logistics, but what is the role and importance of these functions? Both the functions serve a different purpose, are correlated and are vital to the logistics operations, in this article, we decipher a larger view of inbound and outbound logistics operations.
Introduction to Inbound Logistics
Inbound, as the word itself suggests, refers to incoming of goods from a point. In logistics, inbound operations refer to transport, storage and delivery of goods incoming in your business from manufacturers or suppliers. The kind of goods, referred to as inventory, that come in could be raw materials that need further processing or finished goods that require bundling or assembling before they are sent to the market. Having the right amount of inventory at the right time is crucial to the smooth operations of your logistics and supply chain.
Having an optimized and streamlined inbound logistics process laid out depending on your business type and requirements is vital. Receiving, documenting and accurate reporting of the inventory is vital to appropriate and timely functioning of the business.
Introduction to Outbound Logistics
Outbound, refers to outgoing of your goods into the market to your customers. Outbound logistics involves transportation, storage and delivery of finished goods / products from the storage facility or distribution centers to your end customers. Outbound logistics, several times, requires partnering with a distribution and delivery service providers who have a vast and fast distribution network and defined delivery processes, again, depending on your business suitability. Having the right amount of finished goods ready to be sent out in the market is important along with a defined distribution network is important; since outbound logistics is governed by factors like shelf life, consumer demands, seasonal spike in sales, and on order volumes (specially in case of e-commerce businesses).
Streamlining the outbound logistics is important as your finished goods require assembling, special packaging, handling and delivery requirements. In case of e-commerce businesses, outbound logistics is also responsible for leaving a delightful impression on your customers.
It is therefore important to note, both inbound and outbound logistics are vital for a smooth and optimized logistics process.
Processes Involved in Inbound Logistics –
Procurement of Goods – The inventory of unfinished goods or raw materials needs to be sourced from various locations. The businesses need to order and get these goods shipped to the warehousing and storage facility for the next step in the process. Getting the products shipped from the manufacturer or supplier on time and through an appropriate freight shipping channel is important.
Receiving of Goods – The manufacturer or the supplier upon receiving the order, send the goods to a warehousing or a storage facility, where this inventory is received, logged into the system and reported. Another step that many of the e-commerce fulfillment centers follow here is the Quality and Quantity check. This inventory movement inside the warehouse facility can be easily tracked by the logistics or supply chain manager through a WMS (Warehouse management System). Having a WMS system that tracks the movement of the inventory aids the process of recording and reporting and also gives the stakeholders a view of their inventory stored.
Labelling – Once the goods are received in the facility, they are labelled for identification and better reporting.
Inbound Put Away and Picking – Once all the checks and labelling has been completed, the goods are put away in their dedicated space – floor, racks or shelves and logged in the system. Similarly, when required to be sent for the next process or for assembling, the goods are picked up for the next step in the logistics operations.
Reverse Logistics – Reverse logistics is also a part of inbound logistics operations. In case the customer requests for return or exchange, the goods are brought back to the warehouse, quality checked, logged into the inventory tracker, labelled and put away.
Processes Involved in Inbound Logistics –
Order Processing – When an order is received for the finished goods to be moved out, it is logged in the inventory tracker or WMS, and added to the processing orders queue.
Picking and Packing of Products – Upon receiving the order, the good are picked from their assigned shelves or racks, checked for quantity, and then packed as per the packaging requirements. Once packed, the finished products are sorted as per the delivery vendor or carrier, so that they are ready to be dispatched.
Shipping or distribution – If required, Airway bills are generated and pasted on the products and then handed over to the carriers or distributors for the last leg of product distribution in the market. In case of e-commerce distribution, the products are assembled into one package, AWB is generated and then handed over to the last mile carrier.
Appointing a Logistics Partner for Handling Inbound and Outbound Logistics
Inbound and outbound logistics operations play an integral part in the entire logistics and supply chain of a company. If the products are not readily available in the warehouse facility, a company may face delay in making their products available on time in the market, similarly, if the raw material or unfinished goods inventory supply more than the required demand in the market, it could lead to increasing inbound storage costs. While, this is just an example of mismatch of inventory between inbound and outbound logistics operations, there are several other complexities and challenges involved in these processes. Thus, several businesses appoint a logistics partner, like ProConnect Integrated Logistics, who can streamline and optimize these operations. With vast warehouse facilities in UAE and Saudi Arabia, experienced personnel and expertise gained during the years, we specialize in providing smooth inbound and outbound operations and delivery to our customers. Get to know more about our services here or simply get a quick quote for your requirement.