Forward Logistics: What It Is and How It Differs From Reverse Logistics
Logistics can mean the management of complicated operations or the movement of people or physical objects. In eCommerce, logistics services include the processes needed to move merchandise from manufacturer to customer. Forward logistics is the movement of goods from seller to buyer, including eCommerce fulfillment. It facilitates an effective flow of logistics within all levels of the supply chain, paying more attention to timely deliveries of products and product quality preservation within the whole process.
The Difference Between Forward Logistics and Reverse Logistics
The main difference between the forward logistics and reverse logistics is their direction of flow. Forward logistics concerns distribution of goods to customers, whereas reverse logistics deals with returns and recycling, which concerns the back-swing of the supply chain. Reverse logistics is a term commonly used for eCommerce returns because you are reversing the direction of the product movement back to the warehouse. When customers return items, the warehouse might return them to inventory if they are in salable condition.
The Building Blocks of Forward Logistics
Forward logistics is commonly referred to simply as logistics. The core processes include:
- Movement of raw materials and components to factories.
- Transportation of finished goods from the factory to the warehouse.
- Warehousing finished products before sale.
- Pick and pack fulfillment.
- Delivery to the end customer or distribution to brick-and-mortar retail outlets for sale.
Forward logistics guards against theft of goods by employing smart packaging and following safe handling guidelines to guarantee the goods pass through safely. Reliable transportation and distribution make sure that goods can reach their customers on time. Good transport planning will cut delays, enhance a regular delivery pattern, and increase the overall efficiency of the whole supply chain.
Forward Stocking Locations and Picking Efficiency
Forward stocking locations (FSL) represent one of the most effective strategies for improving warehouse picking efficiency and reducing operational costs. By positioning fast-moving inventory in easily accessible locations near packing stations, FSLs dramatically reduce picker travel time while maintaining optimal stock levels for high-velocity items. Picking can be one of the most labor intensive areas of a warehouse, and as a result, also one of the most costly—it can account for approximately 35 percent of your warehousing operating costs. By compressing picking activities into a smaller area, you lower the walking distance of the pickers, lowering energy expenditure as well as injury rates.
Velocity-Based Storage Strategy
Implementing effective forward stocking locations requires ABC analysis identifying which products merit forward placement based on actual picking velocity. The following table illustrates how inventory is typically distributed:
| Item Category | Velocity | Storage Strategy |
|---|---|---|
| A-Items | High Velocity | Positioned in forward stocking locations closest to packing stations. |
| B-Items | Medium Velocity | Secondary forward locations or split between forward and reserve storage. |
| C-Items | Low Velocity | Remain entirely in reserve storage, accessed only when infrequent orders require products. |
Best Practices for Optimizing Forward Logistics
Robust forward and reverse logistic processes are essential elements of your eCommerce supply chain. Here are a few forward logistics best practices to improve your supply chain:
- Move new inventory from dock to stock quickly. Your products can’t generate sales if they’re sitting on the dock.
- Work with a 3PL that offers a zero shrinkage guarantee. Inventory shrinkage will cost you money and can lead to inaccurate stock counts.
- Use inventory management software. Better demand forecasting will allow you to optimize your supply chain and minimize capital outlay.
- Work with a 3PL that has low error rates. That will improve both your forward and reverse logistics.
- Test your packaging. Damaged packaging can lead to returns, even if the merchandise is undamaged.
- Reduce shipping costs and delivery times. Flexible carrier selection can find the best carrier for each package, rather than shipping all your orders with one carrier.
To achieve a forward pick operation, a warehouse management system (WMS) is essential. The software allows you to add RFID tags, barcode scanners, pick-to-light and other systems to enhance order accuracy and customer satisfaction.
