Customer satisfaction is more crucial than ever for logistics companies, shipping businesses, and delivery services. We live in a time when e-commerce is booming, and customers want their packages to arrive fast and in perfect condition. It’s a competitive business world out there, you need to bring your A-game.
The role of effective supply chain management in ensuring customer satisfaction has become a central focus for many companies.
As Australian expert and founder of Zoom2u Technologies (ASX:Z2U) Steve Orenstein puts it: “I can’t repeat this enough: making sure the customer experience is good is more important today than ever before.”
This article explores the significance of customer satisfaction for logistics companies, the link between supply chain management and customer satisfaction, and the strategies companies can implement to enhance both – and ultimately win with customers.
Effective supply chain management: Benefits to your business
Harvard Business Review through the American Customer Satisfaction Index highlights that customers no longer only compare companies to their competitors. But customers also compare them with the best companies and brands across industries.
Here’s how your logistics business can benefit from good supply chain management practices. Effective supply chain strategies can provide a significant competitive advantage by streamlining operations, reducing costs, and improving efficiency.
Longevity in the industry
A logistics company’s reputation is built on the reliability and consistency ensured by effective supply chain managers. Satisfied customers are more likely to return if your logistics operations are on-point.
Building a loyal client base is not easy, it’s to keep them coming back, that’s the key. With repeat customers, you are able to build a sustainable business over time – that’s the goal. Staying in the game!
A bad experience can damage a company’s reputation and see revenue drop. “Great customer experience attracts great reviews, and that experience is not only about the product they bought from you, but also how it was delivered, “ says Orenstein.
Revenue and sales generation
Picture this: You are a logistics company who has recently purchased some route optimization software to better align your production processes with customer demand. In a matter of days, your customers are calling in to thank you for the fast delivery or quick turnaround on an order.
One regular customer who generates quite a bit of revenue for the business notices this change as well. He starts telling his industry partners about your business and the level of service you provide. In the days the weeks that follow, your sales increase dramatically.
Industry competition and supply chain disruptions
The logistics sector is competitive! If you prioritize customer satisfaction and adapt your supply chain operations to navigate challenges, you can set yourself apart from the competition. Imagine a potential customer calls your competitor, only to find they are offering next-day delivery.
In pure frustration the prospect calls you. You inform him your delivery drivers use delivery management software like Locate2u. The businessman then checks your company’s Google reviews, and within the day you have a signed service contract.
Why? Because your company values customers – and delivery speed. “Same-day delivery is the gold standard for speed,” says Orenstein.
supply chain management and customer satisfaction link
You need to have proper supply chain management at the heart of your business so it can achieve a high level of customer satisfaction. Supply and demand management is crucial in integrating activities within the supply chain to ensure efficiency and effectiveness.
The supply chain process comprises everything from procurement and production to delivery and returns. Here are some key ingredients that link supply chain management and customer satisfaction.
- On-time delivery: Rest assured, if your delivery arrives when you say it will, customers will be satisfied.
- Quality control: Imagine you load a damaged parcel into a delivery truck that’s damaged. Your business can’t afford this. Ensure items are properly packaged and transported correctly.
- Communication: Keep customers updated on their delivery. Real-time tracking allows this. “The delivery drivers should be able to communicate with your customers if needed, and vice versa,” says Orenstein.
Of course, managing your supply chain is important, but there’s one key ingredient Steve Orenstein highlights in his book titled Delivery. Problem solving is crucial if you want to keep customers happy.
“If you can make sure that when there’s a problem the customer has the option to give feedback directly to you. You can fix it quickly and they are more likely to feel looked after than frustrated,” says Orenstein.
What technology is used to improve the supply chain?
Using technology can help you improve your company’s supply chain. Managing your company’s supply chain network is crucial for achieving competitive advantage, improving collaboration among supply chain partners, and adapting to changes in the global market.
Drones
Imagine a customer’s level of satisfaction when they actually see their parcel flying directly to their doorstep.
Raw materials play a crucial role in the entire product lifecycle, from sourcing to manufacturing and cost management. Drone technology has made it possible for parcels to be delivered to remote locations. No traffic, no hassle, just speedy delivery.
Warehouse robotics
Picture this: Instead of humans working in your logistics warehouse, you have decided to deploy robotics technology to scan pallets, and pick inventory.
Operations management plays a critical role in overseeing these processes to ensure efficiency and effectiveness in delivering goods and services.
This modern marvel has allowed warehouses to work faster – and deliver products to customers in good time. This leaves the humans to focus on more important tasks like generating business leads.
Recap on supply chain management and customer satisfaction
Proper supply chain management (SCM) is vital to achieve high customer satisfaction.
Implementing route optimization and other helpful tools can help your business meet customer standards and set you apart from competitors.
Neglecting customer satisfaction could lead to a revenue loss, a decline in sales generation, and customers seeking other logistics providers.
NOW READ: Top 5 Delivery trends shaping the future of logistics
Photo Credit: Canva
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About the author
Sharl is a qualified journalist. He has over 10 years’ experience in the media industry, including positions as an editor of a magazine and Business Editor of a daily newspaper. Sharl also has experience in logistics specifically operations, where he worked with global food aid organisations distributing food into Africa. Sharl enjoys writing business stories and human interest pieces.
