The dark side of the sales
Article published in Puls Biznesu on 18th of September 2014.
The statement of Mr. Wojciech Weiss, Partner in Graphene Partners
Money flee. Streets and roads are jammed. Costs grow. All this because of the badly defined sales targets.
The transport peaks cost. A part of them can be avoided. During this year's Forum of Polish Logistics Managers will be published a report prepared as part of the action "Peaks cost".
In the last few days of each month the Polish roads are filled with over twice the number of trucks than in other days. Peaks in the road transport at the end of the month are common in Poland, and the branches that drive the phenomenon, are mainly those that provide their products to retailers. The direction of the development of the commercial market in Poland is clear and predictable. For at least a couple of years the chains smaller and larger, domestic and foreign, will continue to grow. It is expected that in relation with this there will be more and more vehicles on our roads at the end of the month
The level of bad
The peaks have negative effects on the macro scale. It is primarily the increased traffic on the roads, the consequences of which are, among others traffic jams, and in consequence a higher risk of accidents and harmful effects on the environment.
- The enterprises and their chiefs of logistics face the challenges connected with the peaks. The increased demand makes that at the end of the month there are few available means of transport. So their prices rise. Backlogged orders cause delays in deliveries and errors, and with often chaotic preparations of shipments, also damages of the goods – says Wojciech Weiss, a partner of Graphene Partners and an expert of the "Peaks cost".
In addition to measurable negative effects the chiefs of logistics are also observing a negative impact on the functioning of their departments.
Repeatedly working under stress, in overtime and with unreachable performance goals result in reduced motivation. The staff turnover increase. Another problem is the unpredictability of the scale of the peaks. It happens that the employees of the logistics department need 2-3 working days during a peak to enter the "peak speed" and better manage the increased stream of goods – says Wojciech Weiss.
The method for peaks
The reasons of the peaks lie rather outside the logistics departments.
- That does not mean, however, that logisticians can not have an impact on increasing the comfort of their employees, reducing costs, preventing traffic jams. This requires however the involvement of sales departments and customers. And maybe the logistics operators – says Wojciech Weiss.
The chiefs of logistics often take more or less meaningful actions to reduce the onerousness of the peaks. Unfortunately, the results are not satisfactory. One way is to introduce discount schemes that induce customers to stagger their purchases.
- However rarely the discounts in logistics are attractive enough to significantly affect the reduction of the peaks. More effective would be to develop a routine of a more effective cooperation of the logistics department with the sales department, which essence would be a better understanding of the market and the customer requirements. Such cooperation can better prepare to handle peaks – adds Wojciech Weiss.
Less common, but more efficient, is to to engage the logisticians, the traders and - most important – the clients to a better understanding of mutual expectations and possibilities.
In the struggle for the reduction of the peaks there is another important participant in the supply chain - the logistics operator. Has he, however, any interest in this?
Why not. The operators, in order to meet the needs of their customers also need to adapt their activities to the peaks. They engage temporary resources and haulers to handle the increased demand at the end of the month, which increases also their costs. The peaks cost all, so glory to the one who breaks barriers and initiate change – says Wojciech Weiss