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The evolution and role of Logistics in Business

The evolution and role of Logistics in Business. Chapter 1. International Logistics. The process of planning, implementing and controlling the flow and storage of goods, services and related information from a point of origin to a point of consumption located in a different country. Evolution .

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The evolution and role of Logistics in Business

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  1. The evolution and role of Logistics in Business Chapter 1

  2. International Logistics • The process of planning, implementing and controlling the flow and storage of goods, services and related information from a point of origin to a point of consumption located in a different country

  3. Evolution Materials Management Logistics (1990) Supply Chain(2000) Physical Distribution

  4. Role of logistics in business • Logistics adds value to facilitate sales • Logistics expenditure range from 5% to 35% of sales • Firms are interested in achieving logistical competency to gain competitive advantage

  5. Activity centers in Logistics • Transportation (inbound/outbound) • Warehousing • Inventory • Unitization(packaging and packing) • Material handling • Communications

  6. The entire activity can be divided into • Inventory flow (material based) • Information flow ( electronic based)

  7. Characteristics of an organization with effective logistical competency • Alternative logistical capabilities • Flexibility according to the need and demand • Time based performance • Operational control • Postponement capabilities • Commitment to perfect service

  8. Logistical service is measured in terms of • Availability • Operational capability and performance • Service reliabilty

  9. Costs involved in the logistics operation of a firm • Costs of planning and managing the logistics system • Transportation of supplies to the plant • Transportation of finished goods throughout the distribution system • Receiving, inspecting and putting supplies in the storage • Maintaining inventories • Processing customers orders • Packaging • Maintaining warehouses • Providing customer service

  10. Value measures • Ability to meet quoted delivery date • Prompt and comprehensible quotation • Provision of technical advice for problem solving • Discount structure on list prices • Technical after sales service • Easy of contact with person in authority • Replacement guarantee • Wide range of services • Extended credit facilities • Order cycle time • Order accuracy • Order completeness • Order condition

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