Small businesses are the lifeblood of many economies around the world. They provide jobs, services, revenue, and innovation for millions of people, making economies thrive. Small business operations typically enjoy greater flexibility than larger companies. This flexibility makes them more efficient in meeting customer demand, especially in product lines, service agreements, and small-batch runs.
Small businesses, however, face challenges accessing large distribution channels due to high barriers to entry related to transportation, warehousing, and information technology costs. Fortunately, technology is changing this by providing small businesses with access to tools that were once only available to big businesses. This democratization of the logistics industry using technological products and services is a game-changer for small business operations. This article discusses the traditional challenges small business operations face in procuring global logistics networks and how modern technologies rectify this disadvantage.
The Inherent Disadvantage of Small Business Operations
For small businesses, small operations have always worked to their advantage when it comes to facets of customer engagement, timely response, and personable culture. It allows small business owners the flexibility to quickly change their product lines and focus on small batch runs in reaction to customer demand. This small size also gives small businesses an edge in agility, allowing them to move quickly to meet changing market conditions or take advantage of quick opportunities. However, this small size has been a challenge when small companies need to access large distribution channels, making the small business logistics operations much more difficult.
One of the small businesses’ largest challenges is accessing large transportation networks required for small batch runs. They also have difficulties moving small batches through warehouses that are configured to handle full truckloads or pallets rather than small boxes or packages. Historically small business logistics operations have been stuck in a world where global logistic chains have been designed with huge enterprises in mind. As a result, small businesses have struggled immensely in taking advantage of these highly efficient and highly networked chains.
Small-Scale, Smart Logistics Products
Technology is changing this paradigm by making business logistics more affordable and efficient for small businesses. The biggest change so far has been the advent of inexpensive cloud computing services that provide small businesses with low-cost IT services. This technology allows small operation owners to access the storage space and processing power they need for their business operations. Small businesses have also been able to use these services to improve their warehousing capabilities by using technology software that helps them plan and manage distribution channels.
Small businesses are also presently using both general purpose and specialized mobile devices to increase productivity and tap into the massive cost-saving efficiency of global logistical chains. Employees have used small mobile devices to track shipments, communicate with suppliers, and conduct business transactions. They have also used smart mobile technology in warehousing operations like handheld and inbuilt scanners to conduct inventory counts, monitor storage conditions, and issue invoices. Small businesses can use smart barcode labels on packaging (which include tracking numbers) to track items throughout the supply chain.
Small businesses can also take advantage of small, inexpensive satellite tracking devices that are small enough to be used on small parcels. These small tracking devices are capable of sending small messages with packet data, allowing small businesses to use them to monitor small shipments or communicate with small employees in remote locations. These small tracking devices are small enough that small businesses can also use them to help small employees perform small field service tasks or small inventory counts in even the biggest of warehouses.
Mobile barcode label printers, small satellite tracking devices, and inexpensive IT services have allowed small businesses to access large distribution channels at affordable prices. Combining these three tools with parcel carriers like FedEx, DHL, and the United States Postal Service has allowed small businesses to access small, large, and global markets. Technology is making this a reality today, and this would have been impossible in yesteryears.
Reducing Warehouse Costs
Technology is also allowing small businesses to reduce warehousing costs. Before small-scale inventory management software became available, SMEs were forced to use spreadsheets or low-end desktop applications that required a lot of human resources to operate. Small-scale inventory management software has replaced these small-scale solutions and provided small businesses with a more automated warehousing solution. Where small businesses once had to allocate employees to monitor inventories, they can now use software that automatically tracks items as they flow through small storage facilities or small distribution channels.
Technology is also making small business logistics more efficient. Before the advent of inexpensive IT services, many small distribution channels used paper-based systems to track shipments and communicate with supply chain partners. This inefficient system made it difficult for small business owners to manage their supply chains in real-time.
The use of technology allows small businesses to reduce inventory levels, making small operations more like large-scale distribution businesses that use lean inventory processes. Technology makes it easier for small businesses to keep track of items as they flow through the supply chain and then communicate with suppliers at critical points throughout the process.
Small-scale logistics software and transport management systems can help small business owners reduce warehousing costs by providing them with a more organized and automated space. The software also makes it easier for employees to communicate with their partners in the supply chain. In a competitive business environment where speed and agility are key, technology has made it possible for small businesses to access large distribution channels at affordable prices, increasing efficiency and productivity across most sectors of the economy.
In summary, technology is revolutionizing the way small operations leverage global logistical chains. Small businesses can now use smart barcode labels on their packaging and small satellite tracking devices to monitor shipments while using inexpensive IT services and mobile software applications to automate parts of the supply chain. Small businesses can now take advantage of global chains as though they were huge multinational enterprises.