What is logistics?
Logistics is the process of managing the transportation of goods from a point of origin to their final destination. It’s more specifically referred to as supply chain management, or logistics management, and can be incredibly complex with a lot of moving parts that need to be managed carefully to meet the customer’s requirements.
Logistics generally requires logisticians (the staff at logistics companies responsible for implementation of the logistics process) to work with many different providers, each responsible for separate segments of the product journey, right from raw material, materials handling and the final order fulfilment.
Warehousing, and warehouse management, is also a critical part of logistics and works in with inventory management to help with e-commerce order fulfilment, particularly around optimising rapid delivery and demand planning.
Demand planning includes forecasting customer demands at the point of sale, sometimes automation is involved to update the flow of goods to meet rising, or falling, demand. This is tied up with the goal of logistics, which is to achieve customer satisfaction by making sure inbound finished products from distributors arrive right on time, when and where they’re needed.
Logisticians will often work with procurement staff to help them meet their inventory control needs in a cost-effective way, minimising waste but ensuring a positive customer experience.
The lifecycle of goods in the world of logistics may include reverse logistics, where goods are taken from the point of consumption back the way they came through to the original supplier, for the purpose of recycling or safe disposal.
Logisticians will often manage the outsourcing of different logistics activities including transportation management (including companies like Fedex) as well as storage of goods, which are all part of supply chain management. They will work with third-party logistics providers to make sure the movement of goods between transportation modals is not disrupted and there is free information flow, often using shared databases or APIs that make it possible for independent businesses to “talk” to each other to achieve logistics function in an automated way.