Easy Beginner Guide for Logistics Management

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According to the Bureau of Labor Statistics, the job opportunity for logistics management will increase to 4% from 2019 to 2029. It shows there is a huge scope for logistics management.

Similarly, the scope of logistics management involves order processing, inventory control, transportation, warehousing, materials handling, and packaging, all integrated throughout a network of facilities.

Nowadays, global competition is increasing tremendously. Every sector of enterprises is tending towards advanced professionalized applications.

Simply, an organization starts from an idea to achieve certain goals. Matter of fact, we need to actualize that idea and make it happen for real. For that, we need to go through one task to another and it is not a one-time activity.

However, to make our product not fall into a chaotic mess while implementing different processes we need logistics management. The goal is to support procurement, manufacturing, and customer service operational requirements.

What is Logistics Management?

Logistics management is the process of strategically performing the activities for analyzing, acquiring, and maintaining the materials, parts and other inventory through the organization and its different channels to maximize profit.

The goal is to support procurement, manufacturing, and customer service operational requirements. Logistics management manages resources that can range from tangible goods to food or other consumable items. 

In doing so, it deals with integrating the flow of information and its management materials handling, production packaging, inventory, transportation, warehousing, and sometimes security.

For the logistics management of an organization, certain individuals are responsible. And the person who works in this field is called a logistician.

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How Supply Chain Management and Logistics Management are interrelated?

Supply chain management plays a vital role in big organizations. And the logistics management system is the subset of the large supply chain management.

In addition, supply chain management helps to plan, manufacture, decision-making, and implement the flow of goods and services from the origin to the end of the consumption.

Supply Chain Management
Supply Chain Management

Similarly, logistics management focuses on business work to manage project life cycle, supply, and the outcome of the products or services. Meanwhile, if we want to make it large then for that, we need supply chain management. 

Thus, supply chain management helps in a complex and global marketplace.

Different types of Logistics Management

There are four types of logistics management such as supply, distribution, production, and reverse logistics. Each type focuses on a different aspect of the supply process.

1. Supply Management

Supply management involves the planning and coordination of materials or products that are needed at a certain place and time to support the receiving company’s production or activity.

2. Distribution Management

Distribution manages how a supplied and stored material is distributed to its required recipient. It involves the loading, unloading, and transportation of material, the tracking of stock, and accountability of use, which is the recording of how the material is used and by whom.

3. Production Management

Production logistics manages the stages of combining distributed supplies into a product. This can involve the coordination required in a manufacturing or assembling process.

4. Reverse Logistics Management

Lastly, reverse logistics involves the return of material and supplies from a production process. It plans for the removal of excess material and its re-absorption into a stock supply. For example, if there are bricks leftover on a building site, it will be removed and returned to the supplier and reclaimed as stock.

Why is Logistics Management important?

It is most important for any organization that is involved in producing and distributing products and materials. Here are some of the reasons why logistics management is important.

1. Customer satisfaction

As customers demand better service, there’s a need to ship faster, more accurately, and with a high level of quality. It will be possible with the help of logistics management that makes customers satisfied.

2. Reduce cost

It helps to partner with other businesses that offer transportation and storage. Thus, it helps companies to reduce their operational costs.

3. Effectiveness and Efficiency

With the help of logistics management, we can quickly and safely work in shipping, storage, and delivery of products to customers which helps for effectiveness.

Meanwhile, it will increase the rate of demand from customers that leads to efficiency.

4. Value 

It helps to add great value in business as it helps to make customers satisfied and also helps to make work more efficient and effective.

5. Security

By going through all the processes in a systematic way, it helps to make shipping, storage, and delivery safer. As a result, it helps in security.

How to make Logistics Management better? 

The most important thing is to make the organization successful, we need logistics management to perform better. If logistics management performs better then it will directly or indirectly lead to the organization’s welfare.

Nowadays, there are lots of huge organizations and those organizations have a complex structure. Thus, logistics management has to perform better for that kind of organization. Having said that, here are some of the tips to make logistics management better.

1. Good communication

Creating a good working environment culture starts from a conversation. In addition, logistics management is all about the workflow, and to make workflow better we need good communication flow.

Good Communication
Good Communication

Whereas, by committing to strengthening employee relationships, manufacturing managers are committing to strengthening their entire business.

2. Maintain efficient inventory

For an organization, inventory plays a great role. It can either break or make organization,

Besides, to perform a successful operation we need efficient inventory. Thus, it is important to maintain an efficient inventory.

3. Give updates to customer

Customers are a business’s most important asset. Not only do they hold purchasing power, but their opinions have the power to influence other consumers. Therefore, it’s vital to keep them “in the know.” In other words, it’s necessary to be honest with them.

4. Study the market

It is important for every business to study the market. Without the study of the market, we won’t be able to know what changes we need to perform certain operations. Matter of fact, take note of everything that is happening in the market because it is useful to get a good outcome from the business.

What are the 7 R’s of logistics management?

The 7 R’s of logistics management are

  1. Right product
  2. To right customer
  3. In right quantity
  4. In right condition
  5. At right place
  6. At right time
  7. At right cost

What software is used in logistics?

ERP (Enterprise Resource Planning) is used in logistics. It is a system that allows organizations to manage their flow of information effectively by combining various business functions.