Basics of Logistics and Supply Chain Management You Should Know
Logistics are usually referred to the activities, which take place within the limitation of an organization. On the other hand, supply chain refers to the chain of organizations, which performs collaboratively and coordinates their practices so a product can be delivered to the market. In addition to that, traditional logistics are focused on actions like procurement management, delivery, inventory management and maintenance. Supply chain management (SCM) recognizes all the customary logistics and also entails actions such as the development of new product, finance, marketing, and customer service.
Logistics
Logistics is all about delivering the accurate quantity of appropriate products to the appropriate consumer in suitable circumstances, at the appropriate location, cost and time. Previously, a number of tasks used to be separately administered by multiple departments; however, as of today they fall under a single department and reported to a single head. This is known as integrated logistics that incorporates procurement management, production planning, warehousing, transportation, and customer services.
Logistics Management?
Logistics management integrates the effective and proficient administration of routine actions performed during the production of finished goods of an organization.
The Difference between Outbound Logistics and Inbound Logistics
Inbound logistics is referred to the transportation of finished goods as well as raw materials from the suppliers to the organization. On the other hand, outbound logistics is referred to the transportation of the manufactured goods from the company to the end users. Procurement management and distribution centers or warehouses deal with the suppliers are usually identified as the front end of the organization for the suppliers. Production planning and inventory management are situated as the central point between inbound and outbound logistics. Transportation unit and consumer experience centers are responsible to communicate with the clients and are usually identified as the front end of the organization for the end users.
Transport and Logistics
Transport and logistics are referred to two different forms of practices. Transport includes customary services including road, rail, air, or sea transportation, storage and warehousing, and customs clearance. On the other hand, logistics include value-added services namely consulting and information technology.
International Logistics
International logistics is the most unclear set of terms associated with logistics and supply chain management. They are used for international production and global order transportation practices or international supply chain management. They are focused on the ways to administer and control cross border actions in an effective manner as the same business unit. This means that organizations must attempt to connect the importance of international products, services, marketing, and research and development and convert them into their competitive advantage.
Third Party Logistics or 3PL
The idea of Third Party Logistics or 3PL surfaced during the 1980s as a method to decrease expense and enhance services. 3PL is usually referred to outsourcing the practices ranging from a particular job such as land or sea transportation to extensive range of activities supporting the entire supply chain for instance order consulting and processing, and inventory management.
