What companies need to know about logistics software development

Logistics software is important for companies in two critical processes: receiving raw materials and inventory from suppliers and shipping products to customers. As with other business processes, a technology platform increases efficiency and allows companies to provide exceptional customer service that results in greater revenue and profits. Additionally, logistics software provides businesses with real-time information about the status of deliveries and inventory and helps reduce transportation expenses.

These benefits are why the logistics software market is expected to reach $18.31 billion by 2030, according to Future of Market Research . The research firm notes that these platforms are making increasing use of artificial intelligence (AI) to predict demand, optimize inventory, and ensure shipping accuracy.

In the sections below, we take a closer look at logistics software, including what it does, how it can improve supply chain management, the type of software your company might need, and why custom logistics software development can be a great option. useful.

What features are used in logistics software?

Specific functions of logistics software include managing processes with suppliers, retailers and customers so that materials and other items are delivered in the right quantities and at the right times to ensure an optimal flow of materials and products sufficient to meet customer demand . These software applications also provide analytics that help improve the flow of materials, inventory, and customer orders.

Logistics software can be used at every point in the process from procurement or product development to fulfillment. Processes that in the past could have been carried out by separate teams can now be carried out on a single integrated platform. For example, customer requirements and sourcing may previously have been two different operations. With software, they can be coordinated to ensure customers receive their preferred materials or brands.

The following are common management modules included in logistics software platforms.

Analysis

The analytics function uses data to provide suggestions on all other components of the software, as listed below. This module is useful for scaling, improving efficiency, and increasing revenue. Companies can gain a high-level understanding of the entire logistics process and make changes to improve efficiency and reduce costs.

Inventory

This function allows users to manage inventory and raw materials using barcodes, RFID or QR codes. In addition to location, the user can find out information such as the value and status of each shipment. This module can be used to predict future needs and create orders accordingly to optimize costs, improve delivery time and keep customers updated.

Suppliers

This function helps users identify potential suppliers and work with them to ensure smooth operations. Additionally, companies can manage the flow of materials and inventory from the point of origin to or from their location. This function helps eliminate intermediaries that add unnecessary complexity and costs to the process. This component provides another way to ensure customers have the most up-to-date information about the status of their packages.

Storage

This function helps users manage all activities within a company's warehouse. It tracks the movement of products and materials and provides analytics on things like space usage. Tools in this module can include price customization, invoice creation, notifications, and barcode scanning.

Additional functions

Typically, these functions are brought together in a dashboard that displays the most important information. For optimal functionality, users can adjust the dashboard to show the information they need most often. The software also uses the following tools:

• Alerts provide notifications when the user is required to take action, such as when cargo is delayed and other parties must be notified.
• GPS tracking shows where vehicles are at all times, keeping employees and customers informed about the progress of deliveries.
• Payment functionality allows customers to complete their purchases securely.
• Communicating allows users to collect the data needed to make better decisions and stay informed about the most important aspects of their logistics operations.
• Route optimization uses mapping data to determine the fastest routes for vehicles to ensure the most efficient deliveries.
• Vehicle management allows planners to select specific vehicles to be used as needed, providing the best delivery method for the situation.

Key benefits of logistics software

The features mentioned above can result in many benefits for companies using logistics software.

Improve the customer experience

Customers see the delivery process as part of the service you offer. When it is slow or has a defect, customers remember it and can contact your competitors for their next purchase. Even worse, you may lose some clients entirely, as well as any referrals they may have made to family and friends. Social media doesn't help the situation. When a customer is unhappy with this aspect of your service, they are likely to share their experience.

With a smooth delivery process, however, you can retain more customers and acquire new ones based on word of mouth. Advanced logistics software can even help you go beyond expected delivery service by providing specific, real-time updates on where packages are and when they're expected to arrive. This level of service is becoming increasingly mandatory as customer expectations change.

Reduce costs

Analytical features can help logistics software users compare different options. For example, they can compare the costs of different shipping companies to make the best decision about which one to use. Users can also easily see where the most money is being spent in the logistics chain, providing an opportunity to reduce these expenses.

Free up time

Many logistics processes can be automated with software. This way, you can manage this aspect of the company without so much human intervention. Things like invoicing and inventory are more automated. This benefit is useful for two main reasons. First, it reduces human error. Second, team members are free to focus on higher-level tasks.

Manage digital assets

Logistics software can help you manage things like data and documents. The software can retrieve data from multiple sources and then run it through multiple components to reach useful conclusions. You can also store documents like invoices. With all this information in one place, work becomes much more efficient and saves time.

How the Right Software Can Improve Supply Chain Management

At a high level, the right logistics software can improve a company's supply chain management by increasing end-to-end visibility into materials, inventory and customer orders. The ability to track loads and packages in real time allows companies to eliminate or drastically reduce the problem of lost or late deliveries which can be costly, especially as these expenses add up over time.

One of the key tools in modern supply chain management is sensor technology, which allows systems to track packages. Another improvement is in the relationship with suppliers and sellers. With the right software, companies can find the right partners to provide the best service to customers. These partnerships contribute to the goal of a high level of end-to-end visibility and quality. Partners can help each other ensure deliveries are made efficiently and quickly. Another technology that may be involved in this process is blockchain, which some companies use to exchange information and build trust.

Software brings these elements together and provides solutions when problems arise. Technology can also help make predictions and prevent such problems in the first place. In addition to data analysis, machine learning is useful in this process as it can help identify issues such as inefficiencies in route planning, challenges with regulations or environmental, social and governance issues such as ensuring sustainability in operations.

How to choose the best logistics software for your company

The following steps will help you get the best logistics software for your business needs.

Identify goals

Determine what problems need to be solved in your company, including those that at first glance may not necessarily seem related to logistics. For example, your customer service team may know very well that late deliveries are a big problem for customers. In fact, this may be the biggest problem customers face. However, you may not necessarily know this unless you ask the team or gain access to analytics that show this data.

In this case, the identified goal may be to increase on-time deliveries by 100%. This example reveals the importance of involving the entire company. While you may have considered logistics a discrete function in the past, modern business operations require an enterprise-wide approach. Before taking any steps to acquire logistics software, be sure to get buy-in from executives and suggestions from anyone who will use the system.

Other objectives may include reducing vehicle maintenance costs, reducing the number of employees required for logistics operations, or increasing efficiency across the company. Once you identify these goals, try to determine which features and functions can help.

Ask for recommendations

Ask other companies like yours what logistics software they use and what they like about it. Be sure to ask about things like usability, customer service, and functionality. You can also get recommendations online by searching for the best logistics software. Keep in mind that online recommendations may be less reliable because they are often published or supported by companies that provide this software.

Conduct research

Compile a list of potential suppliers and research their offerings. Keep in mind the goals you've already established and make sure the solutions you're examining have the necessary features and functions. In addition to these functions, each platform must be able to integrate with your existing technology stack. And, of course, it must be within your budget.

Narrow the search

Based on your research, narrow the search to the final two or three candidates. Find out if you can use the software on a trial basis or at least get a demo. Now is the time to take advantage of any resources each vendor may have available, such as a sales presentation. After seeing the software in action, make your final decision.

Why custom software is best for logistics companies

While you may find an off-the-shelf (COTS) commercial logistics software application that is perfectly suited for your business, these solutions may not have all the features you need or may have many that you don't need. When this is the case, you might consider designing custom software.

Your first thought when reading this idea might be that it is prohibitively expensive. And it is true that there is a high initial cost for developing custom software. However, there are plenty of benefits to offset the cost, including features that can actually save you money in the long run. For example, custom software is designed to grow with your business, so you won't have to buy a new application if future needs expand beyond your current solution.

Plus, this software is designed specifically for your company's needs, so you won't have to find ways around COTS software features that aren't a perfect fit. Software can be designed to integrate well with the technology you already use. Plus, you get improved security because most breaches occur with COTS software that hackers can easily learn about. The following video highlights some of these benefits and more.

The process of finding a vendor for custom-designed logistics software is similar to looking for COTS logistics software in some ways. For example, it's helpful to get recommendations, do research online, and narrow your search to two or three of the best options. However, once you choose the company, there are a series of additional steps, as listed here.

Consider service quality

You'll need to consider factors beyond software features and basic customer service. The company you choose to design your software should be very in tune with your needs and goals. You will also need to be sure that the company you choose can work with you in the way you need. For example, there are many excellent software developers in different regions of the world who could do excellent work. But if you want a team that can work with you personally, you'll need to limit your search to your local geographic area.

You'll also want to make sure the software company has a lot of experience, especially with companies in your industry. During an interview, staff should be respectful and highly responsive to any questions you may have. You should feel like they are not just a service provider but a partner in helping your business succeed.

Refine your goals

Knowing what you want to achieve with logistics software is even more important when it is designed specifically for your needs. Your custom design team should help you refine your goals and ask specific questions to define exactly what you want.

The following are some questions to ask internally before meeting with any software development company. You can't share all of this information with vendors, but it will be helpful to know as you move forward.

• What problems are we trying to solve?
• What exactly is the deliverable we want at the end of the project?
• What features should it have?
• What features would be nice to have?
• Who needs to be happy with the result?
• Who will use the solution?
• What technologies should the new software integrate with?
• How involved do we want to be in the development process?
• What is our deadline?
• What is the biggest priority for us – quality, price or speed?
• What are our preferred communication methods?

Know what to expect

While you want to believe that your chosen software vendor will do a great job and have your best interest in mind, it never hurts to put everything in writing. In the contract, make sure there are clauses about things like what will happen if the project goes off track and what kind of maintenance and ongoing improvements are included in the service. Additionally, learn about the vendor's communications practices, development methodology, and how they will manage any proprietary information they have access to.

The value of the right solution

Companies that rely heavily on shipping face numerous challenges in today's business environment, especially following the supply chain crisis that occurred during the COVID-19 pandemic. Obstacles include labor and shipping shortages, rising freight costs, increasingly complex systems and changing customer expectations. The right logistics software can help manage all of these issues. The key is to ensure that the solution you use is compatible with your needs and existing technology.