LOGISTICS MANAGEMENT

What is Logistics?
Logistics is the . . . process of planning, implementing, and controlling the efficient, effective flow and storage of goods, services, and related information from point of origin to point of consumption for the purpose of conforming to customer requirements.
Council of Logistics Management

Logistics management includes the design and administration of systems to control the flow of materials, work in progress and finished goods inventory to support business unit strategy.
By Bowersox and Closs

Scope of logistics
This speed & reliability in distribution of products & services contribute to a great extent in the growth of a country`s domestic & international trade . Logistic cost as a percentage of GDP across the world is shown in the following table Country Logistic cost as a percentage of GDP
Korea China Japan India France UK USA 16 15 14 13 12 11 10

Logistics Functions
Purchasing / Procurement Inventory Control

Facility Location / Network Design

Transportation Customer Service

Warehousing
Materials Handling

Order Processing

Factors affecting logistics functions

Lack of Standardisation Too close tolerances and high finishes Efficiency of production functions Effectivness of PPC

Objective of Logistics Management

Highest level customer satisfaction Min. Operating cost Reduced lead time Add value Reduce and control Inventory Improve Communication Just In Time (JIT) Right goods or services, to the Right place, at the Right time, in the Right condition and at the Right cost.

Infrastructure

O A&F p e r operations a S&M t i Out bond In bound o Logistics logistics n s

Technology

Services

Customer Value

M&M

HR

A List of Approaches in Log. Mgmt.

Just in Time Inventory Vendor Managed Inventory Quick Response Collaborative Planning, Forecasting, and Replenishment Outsourcing / 3PLs Flow Through Centers

Build to Order SC Visibility Software Internet Collaborative Transportation Management In - Transit Partnerships / Alliances

Logistics Experience will be different from one sector to another

Textiles speed and variety due to seasonality concerns Retailing (FMCG) prevents stores from having empty shelves or shelves with overstocks Frozen storage and transportation Health hygienic, have limited shelf life, require special storage conditions and entertain high inventory risks Automotive just in time (JIT), delivering parts from thousands of kilometers, special packaging Fuel and Petroleum Transportation very special tanker security systems

Vehicle Logistics
Vehicle logistics services include:
Vehicle Transportation

Marine Transportation (RO-RO)

Ship Loading and Unloading Storage and Parking Lot Services Dealer Distributions Information Systems and Reporting

What is Milk Run Distribution?

It is the combination of shipments from multiple vendors in close geographic proximity into one shipment received by the customer,
normally done for a defined route on a recurring basis.

What is Milk Run Distribution?...

Components of logistics management :

Planning
Inputs into logistics

Management actions Implementation Control

Outputs of logistics

Natural resources (land, facilities, and equipments)

Logistics management Suppliers Raw In-process materials inventory Finished goods

Customers

Marketing orientation (competitive advantage) Time and place utility Efficient movement to customer

Human resources
Customer

Logistics Activities Service

Plant

Financial resources

Demand

Information resources

forecasting Distribution communications Inventory control Material handling Order Processing Parts and service support

and warehouse site selection Procurement Packaging Return goods handling Salvage and scrap disposal Traffic and transportation Warehousing and

Proprietary asset

Production

Interface

Logistics

Interface

Marketing

Plants activity Materials manipulation Quality control Maintenance

Product planning Plant location Purchasing

Transport Inventory management Warehousing

Customer service Packaging Distribution channels Information flow

Promotion Market research Product mix Price