Businesses that put a lot of investment into sound logistics can see tremendous success. Logistics actually originated with the military, where the term was used to describe the process of delivering supplies and weapons to troops, which is something that often took place under dangerous circumstances and across challenging terrain. When applied to business, it deals with efficiently coordinating the movement of goods in the supply chain.
Logistics can be broken down into four main fields: procurement, production, distribution and disposal. Here is a look at how a good logistics team can help a business stand out in each area.
Procurement logistics entails choosing suppliers and negotiating contracts for the goods and services to be delivered. This often involves a lot of market research and decisions on making versus buying. The right logistical techniques can streamline these processes and introduce highly efficient technologies throughout the supply chain. Logistics experts can also help small businesses deal with issues like returned merchandise.
Production logistics deals with the supply chain flow, and it typically encompasses organizational concepts, product planning, and layout. Businesses with complex needs often turn to third-party logistics providers (3PLs) or fourth-party logistics providers (4PLs) for advice on production-related matters, such as streamlining the manufacturing process.
Distribution logistics refers to delivering finished products to customers and deals with order processing, warehousing, and transportation across water, rail and air. Logistics experts, 3PLs and 4PLs can carry out analysis and find ways that these processes can be improved to boost efficiency.
Also known as reverse logistics, this area focuses on reusing material and products in ways that can help cut costs and boost service while protecting the planet. This can be a difficult area for small businesses to deal with, which is why they often hire 3PLs to take care of this part of operations.
This blog post was based off of an article from Dynamic Business. View the original here.