Business Logistics

People have carried out logistics activities for years. As far as humans can recall, goods that people wanted were not produced where they wanted to consume, or were not accessible when they needed to be consumed. Movement of goods was limited depending on the buyers needs, the type of transportation available, storage and perishable nature of commodoties.

Logistics is a system or a process with many components. It is a network of related activities that have a primary purpose to manage the flow of materials and personnel within the firm and through the supply chain. Warehousing of products takes place at the manufaturing plant for later sale. Warehousing and storage activities involve the management of the space to hold the inventory.

Logistics provides an integrated approach bringing fragmened activities together. Such integration helps and improves the flow of inventory by cutting the lag time between production and consumption. It makes use of the fastest mode of transportation whether by surface, sea or air.

In logistics comanies, the department responsible for transportation of the products can negotiate and get cheaper rates for both inbound and outbound transportation.This results logistics companies getting lower freighe rates because of the large quantities involved.

The central coordination of various logistics activities forces cost trade-offs to be made between and among logistics activities such as customer service, transportation, warehousing, inventory management, production planning, and processing.

The Web has now moved from a browser-based tool to an e- business enabler. Logistics is a huge segment of e-business. Its funtional activities are repeated many times through the logistics integrated supply chain. Raw materials that will make the finished product may not be located in the same place.

The consumers may not be in the same place where the product is turned out. This involves the logistics company to control and monitor activities in different locations and deliver the goods to the consumer though the supply chain network.