What are the benefits of operational co-working in contract logistics?
Are you worried that running your own warehouse will eat into your budget? Does a lack of flexibility keep you awake at night during the busiest times of the year? Coworking addresses both these issues. And many more besides. In this article, we’ll explain in detail—and from our own experience—the benefits of operational coworking in contract logistics.
What is operational coworking in the supply chain?
Operational coworking is simply shared logistics operations. But it’s not just about renting an office. In this case, you share powerful operational resources – such as warehouses, loading bays, IT platforms or entire teams of experts – with several other companies within a single network.
Thanks to such extensive networks, your company gains unrestricted access to global operations without having to build its own cumbersome infrastructure. Sounds great, doesn’t it? Let’s therefore discuss the benefits of operational co-working in detail.
What are the benefits of operational co-working in contract logistics?
The decision to adopt a shared model will relieve you of the burden of carrying out all operations within the company on your own. What else? Discover the benefits of operational co-working in contract logistics.
1. Reduced warehousing costs
When you buy an expensive coach just to take your family on a trip once a month, you’re tying up a huge amount of capital and incurring a loss. It’s better to buy a ticket to travel with other passengers. Optimising warehousing costs works in exactly the same way. According to ParcelPlanet, sharing space, docks and staff will reduce your expenses by 20–35%.
You don’t invest in expensive infrastructure; you simply pay for what you use at any given moment. That is why collaboration within a shared warehouse reduces the burden of costs through the sharing of docks.
2. Operational flexibility and scalability (without capital investment)
Think back to the run-up to Christmas. Sales can increase several-fold overnight. Were it not for another benefit of operational co-working in contract logistics, you would have to scramble to find a new warehouse to rent, which is difficult and costly given long-term lease agreements
In the shared model of logistics outsourcing, the infrastructure and team are already in place, so you can quickly increase your space, the number of docks and staff without investing in a new warehouse. You sign much shorter contracts, so after the season you can scale down and pay only for the resources you use.
You operate on third-party infrastructure, with the peace of mind that, in the event of a flood of orders, all of them will leave the warehouse on time.
3. Access to advanced technology and know-how without building your own IT team
What is another benefit of operational co-working in contract logistics? You can immediately utilise powerful WMS platforms, RFID goods tracking technology or artificial intelligence to help determine routes.
Thanks to technology, you have a perfect overview of your goods and full real-time analytics. According to the Work at Thrive publication “Coworking for Logistics Professionals: What to Know”, specialised coworking spaces offer professional management platforms that streamline day-to-day operations.
4. New business partnerships
Working side by side with others, you start by exchanging smiles, and before you know it... contracts. A shared workspace provides an excellent environment for building business relationships and establishing new networks.
As Join-Portal highlights, sharing space with other companies opens up networking opportunities. You can collaborate with groups using the same warehouse, creating valuable industry connections. This gives small and medium-sized enterprises the chance to build a community and gain a competitive edge through shared experiences.
Relationships are a major benefit of operational co-working in contract logistics. You never know when your neighbour at the loading bay might need someone just like you.
5. Improving supply chain efficiency and visibility
Cargo that ‘disappears’ from the radar for a few days is a real nightmare for your nerves. When you operate within a large organisation based on shared services, every procedure is fine-tuned to perfection. You improve resource utilisation, significantly reduce order fulfilment times and raise your SLA standards.
This is confirmed by the publication “Collaborative Logistics: An Innovative Strategy to Address Future Logistics Challenges”. The authors – Gabor Nagu and Szabolcs Szentesi – point out that shared logistics increases the efficiency of supply chain operations, whilst reducing the risk of supply chain disruptions through better resource utilisation, operational flexibility and shared resilience to disruptions.
Smoothness and predictability are the undoubted benefits of operational co-working in contract logistics.
6. Sustainability and a lower carbon footprint
Imagine two different companies each sending a single large lorry from the same city in the same direction. Both lorries are only half-loaded. That is, after all, a waste of fuel and air. And by consolidating loads into a single shipment, you reduce greenhouse gas emissions.
Organising consolidated deliveries improves load factors, which translates into fewer smoking exhaust pipes on the road. Research by the WBCSD has very precisely calculated the benefits of this process for the planet and for business. Let’s take a look:
- transport cost savings of 15–20% (and in more integrated models, even over 20%),
- a reduction in carbon dioxide emissions of 15–30% (depending on the scale of cooperation and the technologies used).
Caring for the environment, and incidentally a positive image for your brand, are further benefits of operational co-working.
7. Greater resilience to crises
As Warren Buffett said: “don’t put all your eggs in one basket”. How does this apply to logistics? If your sole carrier goes out of business, you come to a standstill and incur losses. With an extensive network, however, you distribute tasks across multiple entities operating on a single logistics platform. You diversify your suppliers and cease to be dependent on a single operator.
Secure outsourcing to multiple external entities is nothing other than risk management and business scaling. Your operations do not come to a standstill for even an hour, and these are highly valuable benefits of operational co-working in contract logistics, which you will appreciate at the first major market setback.
8. Freeing up time for business development
Inventory management is an extremely time-consuming task. Entrust it to trusted operators, and they will take this burden off your shoulders. You, in turn, can focus on growing your business.
Operational co-working in contract logistics guarantees a competitive edge and a significant reduction in costs.
Frequently asked questions (FAQ) about the benefits of operational co-working in contract logistics
1. Is operational co-working only beneficial for the e-commerce sector?
No. Although online shops benefit from such advantages, this model also works in the food industry, the automotive sector and even the pharmaceutical industry.
2. Where do I start with sharing operations in the supply chain?
Start by choosing a suitable, verified freight forwarder. Look for one through networking platforms, for example via WCAworld.
3. Is sharing a warehouse with other companies safe for my goods?
Yes. The safety of your pallets is ensured by the EU AEO certificate, precise service level agreements (SLAs) and shared IT modules backed by rigorous KPIs. Everything is under control.
Your stress about maintaining warehouse facilities can disappear. Try the shared business cooperation model. And if you’re looking for an experienced and proven logistics partner, get in touch with us. We’ll set up a transparent and highly secure supply chain for you, which will deliver your profits wherever you want.