Logistics What It Means and How Businesses Use It
Logistics refers to the process of managing how resources are acquired, stored, and transported. It involves identifying distributors and suppliers and determining their effectiveness. Logistics managers are referred to as logisticians.
The term "logistics" originated from the military and is now widely used in the business sector. It specifically refers to how resources are handled and moved along the supply chain by companies in the manufacturing sectors.
Key Takeaways:
– Logistics manages the acquisition, storage, and transportation of resources.
– Poor logistics can impact a business’s bottom line.
– Logistics is widely used in the business sector, particularly in manufacturing, to handle and move resources along the supply chain.
The goal of logistics management is to have the right amount of resources at the right time and location. This ensures timely deliveries and meets the needs of customers.
In industries like natural gas, logistics involves managing pipelines, trucks, storage facilities, and distribution centers. An efficient supply chain and effective logistical procedures reduce costs and increase efficiency. On the other hand, poor logistics lead to untimely deliveries and failure to meet customer needs, impacting the business.
Since the 1960s, business logistics has become more complex due to the global expansion of supply chains. This has led to the need for supply chain logisticians.
The technology boom and logistics complexity have resulted in logistics management software and specialized logistics-focused firms. This enables faster movement of resources along the supply chain. Companies like Amazon dominate the retail landscape due to their innovative and efficient logistics.
Manufacturing companies can outsource logistics management or handle it internally, depending on cost-effectiveness.
Logisticians oversee and manage inventory by arranging transportation and storage.
Specialized training in supply chain management and logistics is necessary for a career as a logistician. A business degree that emphasizes these skills is usually required.
In business, logistics involves transporting and storing raw materials, finished goods, inventory, and other resources. It encompasses several components such as customer service, demand forecasting, warehousing, material handling, inventory control, order processing, and transportation.
Logistics is crucial to a company’s bottom line as it enables the movement of materials, satisfaction of contracts, and fulfillment of services. Efficient logistics management ensures smooth supply chain movement and provides a competitive advantage.
There are various job opportunities in the logistics industry, including truck drivers, customer service representatives, dispatchers, supply chain managers, transportation analysts, procurement managers, logisticians, and operations managers.
When a company optimizes its logistics, it improves efficiency along the supply chain. This adds value to the customer, cuts costs, and boosts the bottom line.
