Management and logistics are vital to any supply chain industry and must coincide to result in a cohesive business plan. Logistics management plays a key role in solving any supply chain problem, as well as in highlighting the company to its biggest competitors. Regardless of the stage at which your business is located, every entrepreneur strives for growth and development. So the need for logistics management is not only advisable but rather mandatory.
A successful company cannot deliver on their promises without allocating sufficient time and resources toward supply chain planning and then executing on these plans through core activities such as logistics.
What is Logistics?
Logistics is that part of supply chain management that plans, implements and controls the efficient, effective flow and storage of goods, services and related information from the point of origin to the point of consumption in order to meet customers’ requirements. It is about getting the right product, to the right customer, in the right quantity, in the right condition, at the right place, at the right time, and at the right cost.
There are many elements that play key roles within a logistical structure, for example, prices and volumes are reviewed to make sure they fulfill what it is being required. Quality assurance deals with the precision of what is being acquired and shipping and handling regulates and control the time that takes to move the items from the shipping point to the delivery point.
Logistics play a crucial role to ensure high levels of productivity, since it can reduce the time it takes to get what is being demanded in the hand of those that are manufacturing or delivering the goods and services to the final customers.
What is a Supply Chain?
A supply chain is an entire system of producing and delivering a product or service, from the very beginning stage of sourcing the raw materials to the final delivery of the product or service to end-users. The supply chain lays out all aspects of the production process, including the activities involved at each stage, information that is being communicated, natural resources that are transformed into useful materials, human resources, and other components that go into the finished product or service.
A supply chain can take on the form of a product based supply chain or that of a service, where services come together to offer an overall customer service as opposed to a finished product, an example of this would be the shipping of customers goods, staff, supply of vessel and fuel are all required in order to provide the shipping service to the consumer.
When our supply chain is connected with that of our suppliers and consumers, we start to build a supply chain network, where we can then go onto understand the flow of both materials and information in a much more complex way.
Difference Between Supply Chain and Logistics
Originally, logistics referred to the physical distribution of resources but businesses and academic scholarship has since recognized the importance of supply chains on efficiency and profit margins.
The most important distinction is that logistics is a distinct part of the supply chain and is essential to good supply chain performance. A supply chain may have many different types of logistics and logistics companies within it, all dedicated to helping the supply chain run smoothly. However, each logistics operation is only responsible for a unique and self-contained part of the supply chain.
Both supply chain management and logistics foster the creation of products or services for customers. The supply chain focuses on how to create the product and deliver it to the customer. Logistics focuses on how to deliver the products to the customer.
However, the scope of supply chain management differs from the logistics scope because logistics is a small part of the supply chain. A supply chain focuses on the entire range of delivering products to customers from sourcing supplies, planning production requirements and arranging customer sales. The logistics scope maintains a narrow focus on delivering goods to the right customer within set timelines.
Logistics and the Supply Chain Go Hand-In-Hand
Logistics management and planning require intricate problem-solving to get products from Point A to Point B without disrupting participants throughout the end-to-end supply chain. Supply chain management can participate in the early innovative phases before a product or service is launched. While product designers are still at the drawing board, logistics managers can help determine how to best establish the flow of the supply chain from suppliers to customers.
Simply put, supply chain management oversees a more extensive process, which includes determining the specifications and type of materials needed for a product. Moreover, within that process, the logistics manager determines how long it will take to move those materials and the most efficient way to ship them to the manufacturer.
Importance of Logistics in Supply Chain
Businesses of all sizes streamline the logistics processes to minimize the cost and increase the efficiencies of overall operations. It will help the organizations to determine and identify the potential problems which are beneficial to optimizing end-to-end supply chain operations.
Generate Positive Business Outcomes
With the right logistics, the back-end operations of your business will seem effortless. An efficient logistics process will take care of the business roots, transportation measures, item locations and other such services. It will present a strategy that will help coordinate the business goals with your distribution or transportation partners.
Added Value For Your Business
Logistics helps you add value to the services that you offer to the customers. You will eventually be able to make your business products easily available for the customers. With proper logistics, you can keep track of some aspects such as warehouse overloading problems to help deal with customer hassles due to it.
Better Warehouse Management
The way you handle your logistics will reflect upon the productivity of your warehouse management. You need to plan upon the logistics strategy based upon the goods that you deal with. With logistics services, you will be able to identify weak and vulnerable points to work upon it for better business outcomes.
Improve Your Customer Loyalty Aspects
Even though you have a magnificent marketing strategy, you will still need logistics to improve the loyalty aspects of your customer. With logistics, you can eventually track on the loose ends of your supply chain and work them out to ensure that your potential customers return to you for multiple purchases.
Faster Product Delivery & Tracking It
When you miss an estimated delivery date, you lose customers. With an ideal logistics strategy, the customers can be sent the tracking information and other details to let them stay prepared with the delivery expectations.
Logistics is the Key to Success in Supply Chains
The supply chain is a consistent process that goes through different stages – production, storage and storage, packaging and delivery of products to the final destination. The better each transaction goes, the more sales you will have for your business, as well as higher profits. Keep in mind that customers are looking for security and speed of delivery, so you can stand out from many competitors by optimizing your various actions. Of course, no one neglects the additional marketing strategies that could help you gain high popularity and attract new customers, but how you serve them is important. Each delivery is a separate unit that you have to deal with more than brilliantly. This can only be achieved with good logistics service. Otherwise you will suffer losses.
The FLEX Logistics Team is Here to Help!
How do you find this waste in logistics operations or any aspect of your business? The easiest way is to simply go to areas of concern and just observe. Bring a pad and pencil along with a list of the types of wastes. See how many of the wastes you can identify then develop an action plan for resolution. To take an even deeper dive, develop a process flow map that identifies value added and non-value added steps in a process. Try to eliminate as many of the non-value added steps as possible.
Our team understands the importance of getting your products to the market. That is why we aim to understand your business and build lasting relationships with you and your team. Whether you are looking to add a new warehouse to your existing operations, growing and need to increase your distribution efforts, or starting a new company, FLEX has the solutions to meet your supply chain needs.
Contact us today to discuss your current and future warehousing and logistics needs. We will work together with you to understand your requirements and develop a solution that will set you up for future success.