{"id":261,"date":"2022-06-15T06:46:05","date_gmt":"2022-06-15T06:46:05","guid":{"rendered":"https:\/\/glutenfreepleasure.com\/__proxy_domain\/encyclopedia.mp.com.sg\/?p=261"},"modified":"2022-10-06T08:01:34","modified_gmt":"2022-10-06T08:01:34","slug":"logistics","status":"publish","type":"post","link":"https:\/\/glutenfreepleasure.com\/__proxy_domain\/encyclopedia.mp.com.sg\/logistics\/","title":{"rendered":"Logistics"},"content":{"rendered":"\n

Logistics is the process of moving goods within the supply chain and ultimately, to consumers. It includes the packing, transportation and storage of goods and managing inventory.<\/p>\n\n\n\n

Comprehensive planning is required for smooth logistics operations. When done correctly, it can improve efficiency, lower costs of production and increase customer satisfaction.<\/p>\n\n\n\n

Efficient and effective logistics management is crucial for many industries including manufacturing, retail, pharmaceutical, and medical.<\/p>\n\n\n\n\u200b\u200b

\n<\/i><\/font> Summary<\/b><\/i>

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  • Logistics refers to the transportation of goods within a supply chain in an efficient manner through various means such as warehousing and inventory management.
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  • It can help to increase efficiency, lower costs of production and increase customer satisfaction.
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  • Logistics is a subset of supply chain management, which is the management and coordination of the production of goods. It includes sourcing, purchasing and manufacturing, among other functions.
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  • There are 3 types of logistics \u2013 inbound, outbound and reverse logistics.\n
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    Types of Logistics<\/strong><\/h2>\n\n\n\n

    There are 3 types of logistics and they can be categorized as follows:<\/p>\n\n\n\n

    Inbound logistics<\/strong><\/h3>\n\n\n\n

    Inbound logistics is the transfer of goods and raw materials from a supplier or manufacturer to a company. It includes processes such as transportation (e.g. via air<\/a> and sea freight<\/a>), storage and inventory tracking.<\/p>\n\n\n\n

    Outbound logistics <\/strong><\/h3>\n\n\n\n

    Outbound logistics is the transfer of finished goods from a company to its consumers through various distribution channels such as retail shops, vendors or wholesalers.<\/p>\n\n\n\n

    Reverse logistics <\/strong><\/h3>\n\n\n\n

    Reverse logistics<\/a> is the transfer of goods from consumers back to the company. This may occur due to reasons such as product refurbishment, recycling or disposal. It is also an integral part of e-commerce businesses as it allows customers to return or exchange their purchases.<\/p>\n\n\n\n

    Key Logistics Functions<\/strong><\/h2>\n\n\n\n

    There are 6 main functions of logistics. They can be done in-house or by companies specializing in logistics services<\/a>.<\/p>\n\n\n\n

    1.<\/strong> Order picking<\/strong><\/h3>\n\n\n\n

    When an order is placed, a pick list is generated. It includes information regarding the stock to be packed and where it should be sent to. Order pickers will retrieve the goods accordingly, based on the pick list.<\/p>\n\n\n\n

    2. Inventory management and monitoring <\/strong><\/h3>\n\n\n\n

    With a constant inflow and outflow of stocks, it is imperative for companies to manage their inventory well and predict demand in a timely manner. This ensures that the supply would be able to meet customers\u2019 demands.<\/p>\n\n\n\n

    Additionally, while it is good to have more stocks on hand, overstocking can reduce cash flow for companies as unsold inventory ties up cash.<\/p>\n\n\n\n

    Hence, having a good inventory management system in place will allow companies to be kept updated on their stock levels and adjust production accordingly. <\/p>\n\n\n\n

    3.<\/strong> Warehousing<\/strong><\/h3>\n\n\n\n

    Warehousing<\/a> is the process of storing goods including raw materials and finished products before they are shipped to other locations.<\/p>\n\n\n\n

    For businesses with global markets, strategic warehousing allows them to store their products closer to their customers, thus reducing delivery times and shipping costs.<\/p>\n\n\n\n

    4. Packaging<\/strong> <\/h3>\n\n\n\n

    Logistical packaging<\/a> involves packing products in a safe manner to prevent damage during transit. Goods should be packed in a way that optimizes space as the cost of shipping increases as the amount of space required increases.<\/p>\n\n\n\n

    5. Transportation <\/strong><\/h3>\n\n\n\n

    This function involves moving goods and raw materials through the supply chain efficiently. Businesses will need to assess the different options to find the most cost-efficient method while considering the nature of the cargo. For example, perishable goods would require a faster method of transportation.<\/p>\n\n\n\n

    The primary modes of transportation are air<\/a>, sea<\/a> and land (which includes truck<\/a> and rail transport). If one or more of the above modes are required, it will be known as intermodal freight.<\/p>\n\n\n\n

    Importance of Logistics Management<\/strong><\/h2>\n\n\n\n

    Proper logistics management can significantly reduce production costs and improve overall business efficiency. <\/p>\n\n\n\n

    On the other hand, poor management could result in:<\/p>\n\n\n\n