Business Guide for Developing Logistics Management Software

It's no surprise, as in a world where same-day shipping and real-time tracking are the norms, consumer expectations are higher than ever. Handling these demands, with costs climbing all the time, puts a great deal of stress on businesses, and they almost can't manage it without automation.

We've made this guide to help your understanding of today's logistics technologies, helping you identify how they can be beneficial for your needs and what's involved in applying these solutions in your day-to-day operations.

What Are the Types of Logistics Management Solutions?

To begin, we need to figure out the tasks that various applications address and the advantages of logistics software for businesses.

Transportation management systems assist with every aspect of physical goods movements beyond company warehouses and departments. They assist in interacting with transport companies, optimizing transportation routes, handling cargo documentation, and tracking shipments.

Warehouse management systems help companies manage and control any warehouse operations. Their role includes managing inventory while efficiently using storage space, automating warehouse goods movement and order picking, regulating staff workload, and overseeing transport loading and unloading at the docks.

Supply chain management systems oversee the entire flow of materials, and data, starting from raw material acquisition to the final delivery of the product. This involves handling orders, overseeing storage and transportation, managing stock, forecasting and planning demand, notifying of potential crises, and assessing system efficiency.

Fleet management apps help in continuously overseeing company's vehicles, gear, and driving staff. This involves tracking vehicle locations, managing shipping orders and optimizing delivery routes, scheduling routine vehicle maintenance checks, and monitoring their technical parameters.

Ecommerce and retail logistics software typically cater to the demands of small and medium-sized firms in managing orders, customer relationships, procurement, inventory control, and delivery setup.

Courier, express and parcel delivery logistics apps are designed for companies that focus on fast delivery, like within the same day or an hour. They provide order management, visibility of couriers, route optimization, and real-time customer communication via SMS, messengers, or an app with a central dashboard.

Freight forwarder solutions are online global logistics track platforms that serve as intermediaries between transportation companies and businesses needing their services. Key features include real-time cargo tracking, automation of routine tasks like carrier selection, documentation, and billing, along with communication tools for shippers.

On-demand delivery logistics platforms allow people to buy from physical stores, restaurants, and pharmacies, and get their purchases delivered to their homes. They include features such as a product catalog, order management system, payments, and a buyer interface for tracking orders, communicating with the courier, and receiving notifications.

Returns management apps, also known as reverse logistics software, are self-service platforms where customers wanting to return a purchased item can check the company's return policies, choose shipping options, print prepaid shipping labels, track the package, and request refunds, credits, or product replacements.

Benefits of Logistics Software for Businesses

Every individual app offers unique gains, assisting the company in meeting particular goals. But overall, they all spur company growth through these universal effects:

1. Improved capacity: Companies can increase product flow and reduce delivery time.
2. Cost reduction: Companies can maximize the use of warehouse space and staff, decrease fuel usage, transportation costs, and the frequency of breakdowns and returns.
3. Superior service quality and a competitive advantage: Customers favor prompt delivery, straightforward processes, real-time tracking of purchases, support, and ongoing contact with sellers and delivery agents.
4. Improved labor management: Logistics management solutions enhance staff productivity by automating tasks, adherence monitoring, tracking and adjusting workloads, and ensuring a safe working environment in warehouses and during transportation.
5. Stronger supply chain resilience: With full operation visibility, centralized control, and system analytics, companies can anticipate and mitigate risks, quickly respond to changes, and rapidly reestablish normal operations after disruptions.

How to Build a Logistics Management Software?

When seeking a business app for logistics management, there are various paths you can take.

1. Comprehensive off-the-shelf apps equipped with modules for every logistic need. It could be SaaS logistics software offered on a subscription basis, or conventional on-premise apps that necessitates buying a license. The issue with these is that for small businesses, the cost is too high and the functionality is excessive, which might confuse staff instead of improving productivity. Meanwhile, for large companies, this one-size-fits-all functionality might not fit their specific needs well enough.
2. Narrow-focused off-the-shelf logistics apps designed for specific tasks, like inventory management, fleet management, or warehousing. Usually, these are SaaS solutions - pretty affordable and popular, especially as logistics software for small businesses. The downside of this approach is that a company ends up with several distinct applications, all based on different technologies, making integration into a single system problematic.
3. Custom logistics software development tailored specifically for a particular company's needs. The only limit to this approach is the cost. Logistics optimization software is complex, and developing them from scratch can take months and cost hundreds of thousands of dollars. That's why it's often combined with the previous approach.
4. Hybrid approach - a custom app with some modules utilizing external logistics services. The method proved effective in lowering logistics app development costs and ensuring the system's coherence with a custom-built application at the heart. Plus, such an app is easily expandable in desired directions, and external services can eventually be replaced with our own code to enhance operational convenience or save on fees charged by third-party logistics providers.

Here's how a hybrid method works: An e-commerce firm sets up its own warehouse and has a custom app developed for running it. It's integrated with their website and order processing system, and an external inventory management service is used to lower development costs. When the firm decides to automate the warehouse, this custom app easily adjusts to new demands, managing conveyors and pick stations.

Now, let’s go through, step by step, how to implement a logistics management system that will effectively fulfill your needs and be quickly cost-effective.

Identify Your Top Needs

To develop such complex software, there's a multi-stage approach. You progress to the final target by navigating through several intermediary phases. Each segment of the app should be operational immediately, bringing forth benefits like cost reduction or income enhancement.

So, figure out your main objective right now, like reducing delivery time or boosting storage capacity, and then pinpoint the software functionalities essential to complete this task and gain measurable benefits.

Consult With a Logistics App Development Company

Professional engineers are the only source of many details needed for decisions about the future solution. They will examine and communicate the expected expense for fulfilling your app's feature requests. It will largely depend on how many systems need to integrate the new app - such as your websites, marketplaces, ERP, CRM, accounting software, etc.

In addition, developers can draw upon their experience working with numerous logistics platforms to suggest alternative approaches to meet your goals that could be more efficient, reliable over the long term, or cost-effective.

Consider Funding Sources

Having grasped the financial requirements for the solution, it's time to figure out if you have enough of your own resources. If not, two paths are open to you. Firstly, consider fundraising. This involves presenting your project to potential investors, and sharing your expected earnings from the forthcoming app. This could be through app monetization if it's a SaaS service, or as a result of scaling up your existing e-commerce, delivery, or logistics business.

The second path is to think about reducing the project scope, delaying some functionality until the next development stage. This will give you time to accumulate sufficient resources.

Carefully Analyze Your Internal Workings and Desired Improvements

Planning a future app is teamwork, needing efforts from both developers and the customer's team. You'll need to think through and describe your internal operations in detail, while developers look for the best ways to automate them. How well this is done largely determines the project's success.

After this phase, we'll have a ready plan for the first stage of logistic software development. This means we'll know exactly what we're building, how long it will take, and when the release will happen.

Prepare to Initiate Trials and Integrate the App's Ready Portion Once It's Out

No matter how complex the app is, it's usually possible to launch the first release within 1.5-2 months from the start of active development. This means that part of the app is functional and ready to benefit your business. Moreover, it needs to undergo a trial to check if our approach to automation and optimization is practical. We have to identify any flaws and make revisions where needed.

So it's crucial that you start actively implementing the released app as soon as possible, adapt new operations, train the staff, get feedback from them, and pass it on to the developers.

Keep Engaged in the Development for Ongoing Improvement

A perfect or even just a decent app can't be planned out in advance. The only way to get it is through trial and error - choosing the path that seems best at the moment, testing the outcome, and making adjustments based on the realities of your business.

You or your team need to stay in close contact with the developers, providing feedback, voicing concerns and wishes, and considering alternatives. This way guarantees maximum benefit from your collaboration with developers and from your new software.

Ensure the Technical Maintenance of Your Finished App

Logistics apps fuel business expansion by amplifying capacity, upgrading service quality, and attracting fresh clientele, and these apps expand along with the business. Once we've implemented and refined all the planned features, it'll be time to reap the benefits through operational expenses reduction and extra profit. This will continue until we reach a point where a new expansion of the logistics app is needed for business growth, and we've amassed the necessary capital.

But it's essential to bear in mind that a developed app still demands maintenance. Ignoring new bugs, failing to update components and integrations, and overlooking your business and consumer data security can seriously harm the app's benefits.

What Are the Key Issues to Consider?

Finally, we'll discuss the major challenges business owners face when creating logistics automation software and explore potential strategies to address them.

Complexity of Integrating Numerous Logistics Solutions

Survey data shows that as of 2023, at least a quarter of shippers and logistics providers use as many as five different technology solutions in their transportation tech stacks, and the same applies to warehousing (refer to the diagram below). Under these conditions, managing and coordinating these different apps is a struggle for the company, leading to poor performance and ROI.

Suggested tactic to address the challenge

This problem can be solved with a custom app that integrates all external logistics services into a single system and automates data synchronization and interaction between them.

Moreover, this issue can be avoided by initiating custom software development for logistics right from the start. It doesn't mean giving up on affordable external services; in fact, it easily incorporates this approach, helping to maximize its effect.

High Costs and Return on Investment Issues

Around two-thirds of shippers and logistics services providers cite cost and return on investment issues as the biggest challenge in digitizing their logistics operations. The price for custom development may vary significantly, from tens to hundreds of thousands of dollars, influenced by the amount of features, as well as the quantity and intricacy of integrated databases and external services.

Suggested tactic to address the challenge

Developers employ two strategies to assist customers with this issue. Firstly, they are knowledgeable about numerous ways to efficiently reduce development costs without sacrificing functionality, such as utilizing open-source technologies, pre-built components, and third-party services for specific functions, instead of building them from scratch.

The second approach involves dividing the logistics and transportation software development into stages in such a way that, at each stage, the functionality is small enough to match the budget, but significant enough to provide tangible benefits and secure a return on investment and capital accumulation for the next phase of app development.

Handling the Operational Shifts and Training Staff

This problem ranks third among the main issues business owners face with logistic management solutions adoption, affecting just under half of the companies in shipping and logistics services. Moving to logistic software necessitates a major shift in the regular working methods of the personnel. Overcoming staff inertia and resistance often demands substantial effort.

Suggested tactic to address the challenge

It's important to underscore again the significance of diligently designing, examining, and enhancing the app's functionality, informed by its actual use and the input from staff interacting with it. Otherwise, an expensive new app can turn out to be a setback rather than an advantage, skewing internal operations and adding to the staff's workload.

Another key aspect is the user-friendly interface and user experience. Although the app's users are not money-paying clients but employees, neglecting this won't lead to anything good. Enhancing this aspect requires not only developers' expertise but also the involvement of the customer's team in communicating feedback from the real users to developers.

Key Takeaways

Logistics management solutions have turned into a lifeline for businesses involved in production, e-commerce, delivery, and transportation. It's nearly impossible to offer exceptional service and compete without these automation tools.

The main challenges in developing logistics apps include their complex functionality and the necessity to integrate with various systems like order processing, client and transport company databases, inventory management, payment systems, and others. These factors contribute to development costs.

In this situation, custom development could be the way out, bringing these benefits to businesses:

1. Developing an app cost-effectively while upholding efficiency. Custom development enables the full use of affordable external services while eliminating their main drawback - the fragmentation of a company's IT system.
2. Creating and refining functionality tailored to the company's needs. This means the app won't have excess features that reduce performance, nor will it have gaps in functionality often found in off-the-shelf solutions.
3. Enhancing ROI by implementing a phased development approach. For logistics management solutions, it's best to evolve incrementally, ensuring each part is essential and starts adding value to the business right away.logistics app development company
4. Ensuring quality, app supporting, and aiding staff training. With a dedicated development team, the app undergoes extensive testing, bugs get resolved quickly, updates are added as needed, and staff can easily get help or suggest improvements to the interface.

Considering a logistics app for your business? - Consult with developers right now! It'll save you lots of time and money.