In the rapidly evolving realm of corporate logistics, businesses face the challenge of operating smoothly, even when spread across multiple locations and administrations. As products traverse borders and different departments collaborate, complexity arises. But what if there’s a solution enabling companies to maximize efficiency, cut costs, and streamline processes, regardless of their internal structures’ complexity? Explore the potency of intercompany logistics in this article.
What is Intercompany Logistics?
Intercompany Logistics entails coordinating and managing the flow of goods and information among various departments or locations within the same enterprise. It’s pivotal for businesses with multiple sites, like central warehouses and sales offices, where each location plays a unique role, from production to sales.
“In a world where efficiency and accuracy are paramount, intercompany logistics significantly reduces manual actions. This is achieved by automating processes such as inventory management and invoicing, crucial for companies operating across borders.”
The importance of efficient processes
An efficient intercompany logistics approach, supported by systems like Exact Globe, enables seamless integration of administrations. This yields automated processes for generating purchase invoices, tracking inventory, and automatically processing sales orders. Consequently, businesses can streamline operations, reducing the likelihood of errors and enhancing operational efficiency.
Why Is ICL important?
Intercompany Logistics (ICL) is crucial for modern enterprises, particularly those with multiple locations like central warehouses and sales offices. ICL plays a key role in efficiently managing these diverse locations. By automating central warehouse administration, such as automating purchase invoices and sales order processing, ICL reduces manual actions and errors.
This is particularly important when two administrations collaborate, like a Dutch company selling products through a German sales office. It ensures seamless transactions and streamlines communication processes, such as phone calls and continuous email exchanges.
Moreover, ICL aids in efficiently managing inventory, reducing operational costs, and enhancing customer service. By leveraging systems like Exact Globe and WMS ICL, companies can optimize their logistics processes, leading to improved business outcomes and customer satisfaction.
How does ICL work?
Intercompany Logistics optimizes coordination between various business units through automation and integration. Central to this system is the central warehouse administration, which automatically processes transactions such as purchase invoices and sales orders. For instance, when a Dutch location solely selling specific products places an order, it’s directly processed and sent to the relevant administration. This connects administrations registered across multiple locations, from the central warehouse to individual sales offices.
The system also facilitates efficient communication among these locations. When a sales office issues an invoice, the data is immediately shared with the central warehouse. This allows for automatic updating of inventory levels. This reduces the need for duplicate administration and promotes swift and accurate accounting.
Advanced systems like Exact Globe and WMS ICL further support these processes through seamless integration and real-time data exchange. This ensures streamlined operations among multiple locations, such as a Dutch production facility and a German sales office. The result is a smooth flow of products and data, with each location efficiently contributing to the common business objective.
WMS in collaboration with ICL
When Warehouse Management Systems (WMS) are combined with Intercompany Logistics (ICL), a powerful synergy emerges, leading to optimized logistics processes. In this system, the central warehouse administration plays a key role, automatically processing administrative tasks such as generating purchase invoices and managing inventory.
This is particularly effective in scenarios where central warehouse locations collaborate with locations solely selling specific products. The integration between WMS and ICL ensures that when a sales office invoices an order, this transaction smoothly traverses between the different registered administrations.
This results in fewer manual actions, better inventory control, and more efficient processing of sales orders. This system is particularly beneficial for internationally operating companies, like a Dutch company selling Dutch products through a German sales office. WMS ICL’s ability to efficiently manage and synchronize diverse locations and administrations facilitates seamless transactions and communication. Both via email and phone calls, among all involved parties!
Various scenarios utilizing Intercompany Logistics
ICL is essential in various operational scenarios within an organization, where process coordination and automation are central:
- Sales Scenario: A Dutch company with a central warehouse collaborates with a German sales office. The German office sells Dutch products, facilitated by the central warehouse administration automatically managing inventory and creating purchase invoices. The Netherlands handles delivery and invoices the German customer.
- Procurement Scenario: The German sales office, with its warehouse, purchases inventory from the Dutch headquarters. The administrations of both locations collaborate, with the central warehouse administration automatically processing transactions.
- Central Warehouse and Multiple Sales Offices: A central warehouse location collaborates with multiple sales offices, each responsible for selling specific products, with the central warehouse administration automating coordination and inventory management.
- Two Central Warehouse Locations with Separate Administration: In this scenario, both companies have both central warehouse administration and sales/purchase administration. These locations also purchase from each other, with automated systems reducing the complexity of transactions.
- Three-Step ICL with Sales Office, Central Warehouse, and Production Facility: This model involves a company manufacturing its own products, storing them in a central warehouse, and selling through a sales office. The integrated central warehouse administration efficiently coordinates all logistics processes.
In these scenarios, all aspects of ICL are leveraged, from automatic inventory management to efficient invoicing, enhancing operational efficiency and customer satisfaction.
Explaining Three-Step ICL
The “three-step” approach combines multiple processes for optimal efficiency. In this model, you have different aspects:
- Production: A company produces Dutch products and accurately records all administrative data. This includes generating purchase invoices for raw materials and managing locations and administrations.
- Storage and Management: The produced products are then stored in a central warehouse, where the central warehouse administration automatically handles inventory management, including tracking receipts and processing sales orders. This is done using advanced systems like WMS ICL and Exact.
- Sales and Distribution: A sales office, for example, in Germany, takes over. This sales office records sales, invoices the end customer, and organizes delivery from the central warehouse. The entire process is supported by continuous email and telephone contact. Moreover, the automated system enables immediate processing of sales orders and invoices.
This integrated approach ensures each step runs efficiently and smoothly, with fewer manual errors and increased customer satisfaction. The company doesn’t have to deal with duplicate work and can focus on growth and success across different locations and administrations. This is the power of ICL.
BizBloqs in collaboration with Exact Globe
BizBloqs is the perfect partner for companies aiming for efficiency and growth in ICL. In collaboration with Exact, we offer advanced solutions that elevate your business. Whether automating central warehouse administration, streamlining sales and procurement processes, or implementing WMS ICL systems, BizBloqs has the expertise and tools you need.
Do you want to unlock the benefits of ICL and take your business to new heights? Don’t hesitate to contact us. Discover today how BizBloqs can support and optimize your business. Together with Exact, we are ready to elevate your intercompany logistics. Contact us for a consultation and discover how BizBloqs can transform your business!
