10 ways logistics companies can improve their customer satisfaction
Nowadays, excellent customer service is a must for companies aiming for profitable growth. Both commercial and business clients want vendors to be reliable, and they will look for new providers if they are not satisfied with the quality of service they receive. There are several ways a third party logistics (3PL) company, a 4PL company, or any other business in the logistics industry can improve customer satisfaction. In this text, you will learn about 10 that yield outstanding results in a relatively short time.
Importance of great customer service in logistics companies
Over 65% of people have higher expectations for customer service today than they did three to five years ago. As a result of this changing landscape, your ability to quickly resolve issues and provide accurate information has more value than ever. If the software your warehouse operates relies on external vendors, you know how important it is to solve issues quickly. In the case of transportation services and shipping services, system downtime that lasts long enough can prevent your business from operating, which may lead to considerable losses or costly fines.
In that situation, demanding a timely fix from your IT vendor is only natural. It’s no wonder your customers expect you to meet deadlines and quickly resolve their queries. And in a market where 75% of customers are willing to spend more to buy from businesses that give them a good customer experience, companies that put their clients first prevail. When it comes to vendors, companies that leverage global operations and hire their experts worldwide get a competitive advantage of being able to work on their clients’ issues 24/7.
Developing a customer-centric strategy for a business to business logistics company can be a more challenging task, but the rewards are evident. Excellent service increases the customer retention rate. According to research by Bain & Company, a 5% increase in customer retention can produce over a 25% increase in profits.
Recognizing the importance of earning customer trust should lead to a comprehensive reconsideration of your priorities. Should you put more emphasis on problem-solving, improve customer-facing processes, or invest in warehouse automation? The answer depends as much on the current industry landscape as on your business’s unique strengths and shortcomings.
While partnering with consulting and outsourcing companies can facilitate business transformation and enable the shift to more customer-centric processes, before deciding on the approach you take, it’s good to know your options. Below, you’ll find 10 ways every global, regional, and American logistics company (including a third-party logistics provider or fourth-party logistics company) can improve the customer experience.
1. Streamline your operations
Streamlining operations is a sure way to improve service delivery and supply chain operations visibility. In addition, simple processes are much easier to comprehend. If your clients understand how their supply chain partner operates, they will trust you more and become more prone to choose your services.
Start by looking at the processes that haven’t been touched for a long time. Think about what parts can be adjusted - more often than not, you will find a more efficient way to get from point A to B. Such an analysis may take up a lot of time, so consider working with a consultant with industry knowledge who knows what to search for.
Once you know which processes can be updated, it’s time to introduce new technologies to help you track and manage inventory, optimize routes and transportation modes, and automate repetitive tasks. The right choice of technology will be an excellent lever for improving efficiency, reducing costs, and streamlining processes, resulting in faster and more accurate deliveries. By streamlining operations, you will also reduce the number of disparate systems utilized by all facets of your operations, the learning curves of such systems, and invariably, mistakes in the process.
2. Invest in the customer service team
When a customer experiences an issue, they want to be treated seriously and see their concerns resolved right away. This is why an outstanding customer service team can become your greatest advantage. Located at the frontline in dealing with customer queries, these teams became cornerstones of many successful, growth-focused companies. On top of improving client retention, every satisfied client can become your advocate and refer more prospects to you.
The first thing you have to do to become known as a company that treats its clients better than others is to invest in customer service training for your employees, so they know how to resolve issues efficiently, how to reduce needed customer effort, and how to deal with customer pressure. Your people represent your business in the eyes of others, so they should embody the company’s values. Once your staff understands their role in customer experience, it’s time to implement feedback mechanisms and focus on providing personalized attention, timely responses, and accurate information to your customers.
Consider local market conditions and customer expectations when planning customer service improvements. Remember that companies in the healthcare market have different needs than telecoms or financial organizations.
3. Leverage data analytics
Every modern logistics company has access to a vast amount of data, but only some leverage this information to improve their operations. Data analytics provide in-depth insight into your daily logistics operations that can be used to make more informed decisions. By analyzing data on transportation routes, inventory levels, product velocities, and customer behavior, you can competently identify areas in need of improvement.
Virtually all modern enterprise software should be able to provide you with the data you need for this analysis. Depending on your company’s specialization and business model, you may want to track different metrics. Nonetheless, along with the key performance indicators (KPIs) of your choice, you should always collect data on delivery times, accuracy, and customer satisfaction. It will give you a good understanding of your organization’s health and help you compare your performance against your competitors. Whenever you find a metric that falls behind the industry average, you should identify areas that should be improved and implement changes that are needed to correct this factor.
4. Establish mutually advantageous partnerships
One of the easiest ways to expand your service offering is to collaborate with partners who supplement your logistics solutions. Working with other industry leaders gives you invaluable insights and information on new developments in related markets. The right partners can help you adopt new technologies, optimize transportation routes, and develop your strategy further.
What partners should you be looking for? It’s a tricky question, and the answer depends on the unique characteristics of your business. For example, if you want to expand your transportation network, you should partner with a carrier that can support your fleet. If you expand to another country, a partner experienced in foreign markets can guide you on this journey. A strong partner network, reaching beyond supply chain partners only, is advantageous for businesses aiming for a strategic approach to growth in the globalized economy.
5. Implement real-time tracking and visibility
Global supply chain visibility data enables you to identify and mitigate issues before they become urgent or harmful, reduce delays, improve communication with customers, and increase transparency.
On top of that, a real-time tracking system allows companies to provide up-to-date information on the shipment status, leading to improved consumer satisfaction. Today’s customers expect convenient access to such information on their laptops or smartphones. The only way to reliably provide them with accurate data is by leveraging tailor-made software for your company.
6. Embrace continuous improvement
Tech companies know that the modern software development process never truly ends. There is always something to improve or a new functionality to add to become more agile. Customer-first logistics companies could benefit from adopting the same mindset, as there is always room for improvement in that industry as well.
Organizations that strive for continuous improvement review their processes regularly, seek feedback from customers and employees, and identify more areas for improvement. This way, they repeatedly eliminate inefficiencies, improve processes, optimize costs, and fight the decline in customer satisfaction.
This journey will never end, but it has to start somewhere. It would be best if you began by updating your current systems and ensuring they are ready to support your growth. While doing so, make sure your whole company understands the continuous improvement mindset, as from now on, all employees must look at their roles differently and think about how their end can be improved.
7. Enhance security measures
If you put safety measures on the back burner, you expose yourself to hundreds of cyber threats. Today, you must have robust cybersecurity policies across all business functions - from customs brokerage to cargo insurance to freight forwarding - to protect your business, shipments, and customer data from malicious actors and incidents.
But security is also crucial when it comes to your employees and the goods you’re taking care of. By using secure packaging, implementing driver safety training, and installing security cameras, your business becomes well-protected. As a consequence, it also becomes trusted by its clients. People look for safety and want to see that their supply chain partners take it seriously.
8. Reevaluate the transportation routes
Transportation of goods is the biggest cost logistics companies have to face. Truck maintenance is expensive, and so are gas and drivers’ salaries. It only makes sense to optimize further expenses by using the most efficient routes.
Software solutions can aid your transportation management by finding the shortest and safest routes, so you can optimize the gas cost and ensure that the goods don’t get damaged in transit. Load planning is also easier with applications, so you can ensure all vehicles carry full loads and don’t drive with empty trailers pretty effortlessly.
However, the best way to ensure your company realizes its full potential is to work with the right people who believe in your business and understand how it works. Such trusted advisors will help you redesign transportation routes for improved cost and time efficiency and make sure your every mode of transportation benefits from occasional reevaluation.
9. Improve warehouse management
The truth is the way your warehouse operates determines how efficiently you manage inventories and how fast you fill orders and transport goods. It doesn’t matter what you store and transport. If you’re not using robots to move boxes, you waste valuable time. If you’re not using vertical columns, you waste priceless space. Usually, in every warehouse, there are improvements to be made to move the boxes from shelves to trucks in a more efficient manner.
Ensuring proper warehouse management and supply chain management can be partially achieved by utilizing modern Warehouse Management Systems. If you’re not using one yet, or run an outdated system, it’s time to act. Optimized warehousing will not only help you provide excellent service but also keep your mind calm and clear. When not worrying about managing chaos, you can focus on things that make your business stand out.
10. Optimize efficiency with automation
Today, almost all businesses use some kind of automation, and you should do it too if you want to thrive in the years to come. By embracing new technologies, you will speed up your organization's operations, improve communication, decrease the need for manual labor, and reduce human error.
Automation won’t replace your employees. It will help them focus on the most important areas of your business. Adjusting to change may be difficult, but automating mundane and repetitive tasks that have troubled your workforce for a long time will quickly pay off the investment. The best thing about this technology is that custom automation may solve even the most unusual challenges logistics companies face.
Achieve your business goals quicker by working with experts
So, how do you start optimizing your organization? It’s easier to find room for improvement with a process scorecard. Tracking how everything really works will lead you to discover inefficiencies in your processes. If you run into trouble deciding the priorities or next steps, consider hiring a consultant with subject matter experience. Such experts, often with previous careers in logistics, will measure relevant metrics, devise strategies based on thorough analysis, and deliver unique solutions tailored to your business needs.
Maxima Consulting has supported businesses in their digital transformations since 1993. Contact us today and schedule a free consultation with one of our logistics experts. Once we understand what’s unique about your company, we’ll know how to optimize its performance.
