Logistics Chapter 1 Part 1

• Logistics


  The management (planning; organizing; leading and control) of the movement of products/services from the manufacturers/suppliers to retailers and ultimately consumer
• Supply chain management


  The process of managing the entire supply chain of retail organizations, including the management of the flow (both forward and backward) and storage of goods, services, and related information between the point of origin and the point of consumption to meet customer needs
• The main aim of any business is profit
• Sales/income must be greater than costs/expenses
• The lower the costs, the higher the profits or the more sales, the more profits
• Logistics may improve profits by lowering costs and increasing sales through effective and efficient service
• Main aim of logistics

  To ensure that retailers have the right products available to consumers, at the right place, at the right price, at the right time and at the right cost to the retailer
• Members in the Supply Chain

  • Suppliers of raw materials
  • Manufacturers
  • Wholesalers/Agents
  • Retailers
  • Consumers
• Retail Supply Chain Management

  The process of managing the entire supply chain of retail organizations
• Negative effects of poorly managed logistics: Customer dissatisfaction, negative word of mouth, support for competition, loss of sales, lower profits and higher costs
• Logistics core functions/Supply Chain Management functions


  • Transport
  • Warehousing
  • Inventory management
  • Communication
  • Purchasing/Procurement
  • Packaging
  • Handling materials
  • Order processing
  • Customer Service
  • Reverse logistics
  • Demand management
• Transport


  Movement of goods from suppliers to warehouses to stores, or movement of goods from warehouses to customers, making decisions on who, how, and when to move goods (e.g. use road, rail, air, etc.)
• Warehousing


  Decisions on whether the warehouse is centralised or decentralised, finding the right location(s) for warehouses, which equipment is required, which suppliers, staffing, security, etc.