Unit 1logistics Management
Unit 1logistics Management
Unit 1logistics Management
Definition of Logistics
According to Council of Logistics Management (CLM) :
“Logistics is the process of planning, implementing and controlling the
efficient, cost-effective flow and storage of raw material in-
process inventory, finished goods and related information from point of
origin to point of consumption for the purpose of confirming customer
requirements”.
Objectives of Logistics
1) Improving Customer Service :
By attaining customer satisfaction, highest level of profits can be ensured.
Thus, continuous improvement in customer service acts as the core
objective of logistics.
2) Speedy Response :
It refers to the organisation's ability to give prompt response to the
customers queries. In today's era of IT, it has become completely
manageable to give immediate response to the customers' queries by
acquiring related data and postponing logistical functions to latest time
for increasing the response rate.
8) Stability of Costs :
Another purpose of logistics is to ensure the stability of costs. It can be
attained by managing the supply of goods through thoughtful use of the
accessible transportation and suitable storage facilities.
9) Upgrading Quality :
In the long-run, logistics seeks to ensure continuous quality improvement.
Total Quality Management has emerged as a primary obligation in all
parts of the industry within this aspect. Its assurance is mainly
responsible for logistical regeneration.
1. Order Processing
2. Material Handling
3. Inventory Management
4. Warehouse Management
5. Transportation
5. Control
Logistics is a complex operational procedure that requires a lot of precise
information to be effective. Forecasting demand, transportation times,
and inventory are crucial to keeping the operations to a tight timescale.
Physical distribution
Physical distribution is the movement of goods, products, and raw
materials between warehouses, factories, and distribution centers, and
sending finished products to the customer.
Customer Service
Customer service in supply chain management refers to the precisely-
defined standard of customer satisfaction that a small business provides to
its customers. Once a standard is set (ex: 60% of all shipments delivered
to customers within 48 hours of ordering) a physical distribution system
is then set up to reach that goal at the lowest possible cost.
Transportation
Warehousing
Order Processing
Order processing methods often vary from industry to industry, but the
basic idea is to deliver the order as the customer expects, in the way they
expect it, and when they expect it to be there. Thus, accuracy plays a vital
role in successful order processing, as do procedures that minimize the
order processing cycle.
Inventory Control
Inventory control is a major component of any physical distribution
system. Inventory control is used to keep inventories in a desired state
while continuing to adequately supply customers. Costs include funds
invested in inventory, depreciation, and possible obsolescence of the
goods.
Materials Handling
functions of a warehouse –
1. Storage
carefully estimated storage required to meet the regular customer
demand.
2. Safeguarding of Goods
protection to goods from loss, theft, or damage due to unfavourable
weather conditions like heat, wind, dust and moisture, etc.
3. Movement of Goods
It consists of the following-
Inbound activity– It means unloading of goods received by the
warehouse.
Transfer to storage– It refers to transferring the goods from the
inbound area to the storage area.
Order selecting–It means choosing the item in the storage
corresponding to the order to be shipped and moving it to the
shipment area.
Outbound activity– Lastly, we have ‘outbound activity’, which
means inspecting and loading the goods for shipment.
4. Information Management
keep track of information about goods and materials sent into the
warehouse, stored and shipped out. In addition to that, any other
information regarding the warehouse is recorded.
5. Other Functions
Risk bearing- The moment goods are delivered for storage, the liability
of these goods transfers to the warehouse-keeper. Consequently, the risk
of loss or damage to goods is borne by the warehouse keeper.