Home Management Logistics HOW LOGISTICS CONTRIBUTE TO SUPPLY CHAIN

HOW LOGISTICS CONTRIBUTE TO SUPPLY CHAIN

The contribution of Logistics to the supply chain plays a strategically important role. This post will evaluate the logistics contribution to the supply chain.

0
20

THE DEFINITION OF LOGISTICS

Cambridge Dictionary (2019) defines the logistics as the process of planning and organizing to make sure that resources are in the places where they are needed, so that an activity or process happens effectively” In the Martin Christopher book, Logistics and Supply Chain Management define as “Logistics is the process of strategically managing the procurement, movement, and storage of materials, parts and finished inventory (and the related information flows) through the organization and its marketing channels in such a way that current and future profitability are maximized through the cost-effective fulfillment of orders”. Ricardo Ernst “Logistics, in its conventional definition, is the process of managing the flow of goods, information, and finances from the source (suppliers) to the final consumer (customers)”.
LOGISTICS CONTRIBUTE TO SUPPLY CHAIN

ROLE OF LOGISTICS

  • Order-processing
  • Purchasing and Invoicing
  • Inbound transport
  • Production plans and schedules
  • Inventory management
  • Distribution and delivery transport
  • Warehouse management
  • Customer response management
  • Materials requirements planning
  • Distribution requirements planning

MODES AND TYPES OF LOGISTICS ADOPTED IN VARIOUS BUSINESSES

Transport modes are designed to either carry passengers or freight, sometime carry a combination of both. Each mode is characterized by a set of technical, operational and commercial characteristics.
Mode Description
Road transportation Road transport systems is quick and responsive.  
Rail transportation and pipelines Heavy industries are traditionally linked with rail transport systems, although containerization has improved the flexibility of rail transportation by linking it with road and maritime modes.  
Maritime transportation Ocean plays vital role in moving goods more cost effective way.    
Air transportation Air transportation plays important role in moving goods.  
Mode of Transport and Importance

COMMON ISSUES AFFECTING LOGISTICS OPERATIONS  

COMPLIANCE WITH REGULATIONS

Logistic is govern by transportation rules, regulations and security norms can vary from country to country. It can pose a grave challenge for Logistic companies to adopt and response to compliance in the logistic sector.

ADDITIONAL FUEL COSTS

One of the highest costs contributing concern is fuel prices.  With the fluctuation of fuel prices transportation costs can be drastically change the profitability of logistic companies.

PROCESSING ENORMOUS AMOUNTS OF INFORMATION

Integration multiple parties and partners in Logistics is complex and difficult. Often require to deal with a lot of figures and data daily, besides coordinating smooth discharge of operations. The scope of their work includes ensuring the safety of the fleet and staff, fleet loading, cross-checking route maps, sanctioning fuel bills and so on. This can be time-consuming and tedious task that can take your focus off from attention to details.

TECHNOLOGY STRATEGY & IMPLEMENTATION

While the industry understands, and supports many of the benefits of these technologies, some questions remain as to how they will pay for it and who will help implement the improvements.
LOGISTICS CONTRIBUTE TO SUPPLY CHAIN

NO COMMENTS

LEAVE A REPLY

Please enter your comment!
Please enter your name here