Logistics is increasingly acquiring greater importance in the strategic planning of businesses.
Formerly known as “transportation and distribution functions”, today it’s considered an essential element to the success of organizations.
Internal logistics helps all the internal processes of an organization to be controlled and aligned.
What is internal logistics?
In short, and emphasizing what has been said previously, internal logistics covers all the movement of supplies and the performance of support activities within the company.
It includes processes such as:
- Material and equipment control
- Storage and automation systems
- Stock control
Basically, we could say that it allows controlling material movements within the organization, guaranteeing a product’s specific time, quantity, and place.
The importance of internal logistics within a company
If there were no internal logistical processes, there would be constant problems because, for example, necessary materials don’t reach the production line.
If they don’t arrive at the right time, the production process wouldn’t start and, therefore, they would not be distributed. This would affect the economic efficiency of the process and not produce any kind of profit.
In addition, internal logistics also helps the consumer by providing a product that is in excellent condition.
All of which wouldn’t be possible without a constant, synchronized flow of materials.
Without internal logistics, the company’s strategies, no matter how good they may be, wouldn’t be carried out, and it would compromise the growth of the company within the market.
Internal logistics is also a strategy
If applied correctly, internal logistics can make any strategy to reduce costs and increase the quality of service offered to the consumer.
Many large companies such as Nike, Bosch, or Mercedes use internal logistics.
And no wonder, because these are just a few of the benefits it can produce:
- Better use of labor force
- Increases agility within internal procedures
- Reduction of maintenance costs
- Greater use of the industrial facility
- Reduction of any unnecessary stocks in the warehouse
- Correct material flow
What does all this translate to? Much more satisfactory and efficient service for the client.
To achieve our goals, a good predisposition is needed to correctly apply internal logistics. If not, we are risking customer satisfaction.
For all this, internal logistics has managed to gain a lot of importance in recent years.
Good use of it brings many benefits and a quantitative leap in an increasingly competitive market.
Companies that are not implementing internal logistics need to start catching up.
What is Intralogistics?
We have defined logistics as an efficient internal organization to start and maintain production activities within the company.
Intralogistics is a term that includes much more. It encompasses, in an industrial facility that functions as a warehouse or distribution centre, the optimization, and management of the flow of information and supplies.
Intralogistics isn’t something new. It has been implemented in companies for years, but now it has been given a word and become a fashionable term.
The purpose of intralogistics is to improve productivity through an excellent combination of equipment, manpower, and technology.
The benefits are what any manager would like to achieve in his supply chain:
- Reducing costs
- Increasing sales
- Reducing inventory
Companies are investing more and more in intralogistics to optimize their delivery times, which has become a clear competitive advantage.
With the vast number of alternatives that the market currently offers us, choosing seems complicated. Therefore, you have to know what the client is currently looking for:
- Low-cost products
- Good distribution service
- Punctual delivery
If we apply intralogistics in our internal processes, and we achieve all of this, we will win a customer, perhaps, for life.
Challenges within the field of intralogistics
Intralogistics is not the panacea for all internal logistics problems in a company.
It also has several challenges to handle to keep improving a business.
Nowadays companies have to face deliveries, not only on a national level but also to anywhere on the planet.
It’s a very difficult flow of information and products to control. This forces companies, especially those with internationalization plans, to become super competitive.
We are not only competing with national companies, but also with organizations from other countries that may have superior technology and equipment.
Internet of things, digitization, industry 4.0… all this will help the supply chain to become stronger and smarter.
Electronic commerce encompasses the largest set of commercial transactions carried out nowadays.
The management of customer orders has changed completely and, as a consequence, transport logistics.
Now, people expect the company to deliver a product the next day, wherever the client chooses and adapting to a schedule.
But let’s not fool ourselves, not many companies are able to do that, apart from Amazon and a few others.
The size and shape of packages are changing and they have to adapt to transport chains.
The level of detail is so high that we must be 100% sure of what we are doing. There’s a lot of pressure to do things well and fast.
Today, connected and automated production and distribution activities cannot be fully understood.
Having an industrial warehouse working at full power 24/7 implies a huge expenditure of energy in the facilities.
Another challenge for intralogistics is to achieve an adequate management of energy efficiency.
The almost infinite benefits that automation has brought to manufacturing activities around the world are more than evident, but it comes at a cost.
You need to be connected to the network to make use of an automated system.
Smart devices are already being used, especially in the automotive industry, which allows us to measure energy consumption in real-time, to make the necessary adjustments.
Intralogistics 4.0 introduces elements of the 4th industrial revolution to the logistic process.
The most important difference is that we are not only referring to the act of handling the product, but also to the collection and management of information about that specific product. Now, these two activities form a single indivisible operation.
This implies an overall change in everything we knew about handling because all the trends and innovations that this industrial revolution brings will modify all the standards known to date within logistics processes.
Anyone who has run, in the past, an industrial warehouse where products are manufactured knows that logistic processes were characterized by lacking supply control, they were quite dirty and everything was disorganized.
- Article of interest: Industrial cleaning methods
As time went by, we have seen the addition of racks and forklifts, as well as the different inventory configuration systems (LIFO, FIFO, DRIVE-IN, etc.).
We are talking about systems that were designed based on operational limitations that no longer exist today.
Moreover, in many of these processes, human beings are no longer useful, since logistics processes now encompass very repetitive, complex, and even dangerous activities.
New distribution centres, warehouses, and industrial buildings based on intralogistics 4.0 are formed on the following concepts:
- Automated cargo
- Use of robots
- Big Data
The possibility of integrating all this becomes more and more strategic, as it allows us to achieve a constant analysis of our production activity, obtaining real-time data.
Necessary elements in internal logistics
Intralogistics or internal logistics, to function efficiently, also depend on other necessary elements such as:
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