Goods Flow
Goods flow describes the movement of goods through the entire supply chain from suppliers, via production and inventory, to the end customer. An efficient goods flow ensures that goods move quickly and safely, while tied-up inventory and costs are minimized.
What is Goods Flow?
Goods flow encompasses all steps where goods are handled, transported, or stored.
It includes:
- Inbound Logistics: Transport and receipt of raw materials or components from suppliers.
- Inventory Handling: Movement, storage, and picking of goods in the warehouse.
- Production and Assembly: Movement of materials through production processes.
- Outbound Logistics: Distribution of finished products to customers or sales channels.
- Transport Management: Planning and optimization of routes and delivery methods to reduce time and costs.
Benefits of an Efficient Goods Flow
An efficient goods flow helps companies to:
- Reduce capital tied up in inventory: Rapid movement of goods minimizes the need for large stock levels.
- Increase delivery capability: Shorter and more reliable delivery cycles ensure a higher service level.
- Optimize resources: Efficient handling of transport and inventory reduces waste and operating costs.
- Improve planning: An overview of the goods flow makes it easier to plan production and purchasing.
How to Optimize Goods Flow?
Optimizing goods flow requires both data insight and process improvement:
- Analysis of movements: Identifying bottlenecks and unnecessary steps.
- Layout and process design: Arranging inventory, production, and transport for minimal movement.
- Planning and coordination: Synchronizing purchasing, production, and distribution with demand.
- Automation and digitalization: The use of systems for tracking, picking, and transport management to reduce errors and waiting time.