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Models of Logistics: What Do Logistics Companies Do?

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Nov. 22, 2022, 10:22 a.m.

By definition, a logistics company controls and streamlines various processes of moving goods, including warehousing, inventory management, transportation, packaging, and freight forwarding service assistance, from the point of origin to the point of consumption based on specific customer requirements. Simply put, they ensure that the right products are in the right place at the right time and how to get them there.

Often, companies provide a bundle of logistics services, combining more than one service highlighted in this week’s snapshot.

Shipping/Freighting:

These are organizations that transport commodities, goods, and cargo in bulk by trucks, ships, or aircraft. They own transportation assets. Common approaches to freight shipping include truckload - which uses the entire space available in the truck to carry the freight from one shipper to one location, less than truckload (LTL) - which allows businesses to combine their freight with those of other businesses so that they do not have to pay for the cost of using the entire truckload, and intermodal - which involves moving freight by two or more modes of transport. In Kenya, Senga operates across East African countries, and TMX Global serves domestic, regional, and international markets. Nigeria’s TradeDepot distributes retail products from suppliers, while Egypt’s Ufelix provides shipping and delivery solutions.

Freight Management and Freight Forwarding:

Freight management organizations organize and coordinate shipments for individuals or companies from production to the end-user. They connect consignors of goods to logistics operators. They also have integrated logistics solutions platforms that digitize logistics services for different stakeholders. Ironji in Rwanda, Kobo360 in Nigeria, Kamtar in Ivory Coast, and Trella in Egypt offer digital marketplace linking shippers with carriers, while Freterium in Morocco has software for tracking goods and connecting all stakeholders across the shipping ecosystem - from manufacturers and distributors to retailers and logistics providers.

Freight forwarding companies provide freight management services, operating in cross-border logistics and acting as intermediaries between transportation companies that import and export goods and the businesses that need them. Freight forwarders manage every aspect of transportation, from storing goods before shipment to ensuring they make it through customs. Jetstream Africa in Ghana offers cross-border e-logistics services in addition to end cargo tracking, real-time updates, vendor performance management, and supply chain insights.

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Courier Services & Last Mile Delivery

These companies offer on-demand delivery and transport of commercial goods and products or delivery to the final mile. They transport merchandise from the nearest distribution hub to the final destination, such as a home or business. Couriers may use self-owned, privately shared, or public transportation to supply these services. Kenya’s Sendy offers fulfillment and doorstep deliveries for businesses, Senegal’s Paps caters to small to large businesses, assisting them with their logistics needs, from storage and international transport to last-mile delivery, Eshi Express in Ethiopia delivers customers’ packages across the cities, while Nigeria’s Arone uses drones for the fast delivery of medical supplies to and from clinics, hospitals, labs, and health facilities.Storage & Warehousing:

These companies offer storage facilities where raw materials or manufactured goods can be stored prior to further distribution or collection. In South Africa, ParcelNinja offers outsourced warehousing and fulfillment to businesses, while CQuential provides warehouse management software that covers all the processes within the warehouse, including receiving, storing, stock takes, planning, picking, checking, and dispatch.

Cold Chain:

They offer temperature-controlled transport or storage of perishable goods. The main elements of a cold chain involve cooling systems, cold storage, cold transport, and cold processing and distribution. Several means by which cold chain products can be transported include refrigerated trucks and railcars, refrigerated cargo ships, reefers, and air cargo. Kenya’s Cold Solutions offers logistics solutions and owns a network of cold chain warehouses across East Africa.

Addressing System:

These organizations facilitate, deliver, or manage post-related services. They have systems that map out locations and optimize navigation routes for transport and delivery. Ghana’s SnooCODE has a mobile app that uses a computer algorithm to generate a unique code for any location, which then serves as an address, while Kenya’s OkHi offers a smart address verification service that allows businesses to collect and verify customers’ addresses through their smartphones.

tag: Africa, Delivery Business, Entrepreneurship, Logistic Company, Startup, Businesses,

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