When it comes to definition of logistics, it is simply the grouping and application of a composite operation. The article discusses the concept of logistics in terms of freight forwarding, transportation and related activities with special reference to the needs of modern importers and exporters
It guides the road to effective Supply Chain Management by planning, implementing and controlling the efficiency of forward and reverse flow. Moreover, it governs the packaging, loading, transportation and delivery of shipments by air, ocean or road on behalf of valued importers and exporters. Logistics actually is the source of movement of goods and raw materials into the supply chain.
7 R’s of Logistics
To understand the basics of logistics management we must understand the concept of Seven R’s proposed by The Chartered Institute of Logistics & Transport UK.
- Right Product
- Right quantity
- Right condition
- Right place
- Right time
- Right Customer
- Right price
The 7 R’s are self-explanatory to understand the concept of modern freight forwarding and logistics.
Manipulative Variables of the Logistics Management
Logistics management is influenced by various factors which enhance its productivity within the supply chain. These factors include:
Several modes of transportation are used to transfer and move goods within the supply chain using air, rail, road, water and pipeline. The selection of best combination of modes of transportation enhances the value created for customers.
Warehousing plays a crucial role in logistics sector. Between the time of booking and delivering the goods the importers may need to stock their merchandise for necessary reasons. Warehouses are also used as receiving, storing and shipping of products to and from distribution location. Cargogiants International is specialised in warehousing for its capacity of delivering the best freight forwarding services in Pakistan.
3PL and 4PL Logistics
Third and fourth party logistics are trendy concepts. The 3PL setup provides and manages partial logistic services. On the other hand, a 4PL company takes over the whole logistic project for considerably sized shipments.
As the name suggests it is a phenomenon to handle the reverse process of logistics including returns, reuse, recycling and disposal of products from the customer to supplier.
Logistics Value Proposition
Managers must be able to balance the logistics cost to deliver timely and appropriate customer service. Logistics are generally managed as an integrated effort to achieve maximum customer satisfaction at the lowest total cost. Therefore, services and cost minimization are two key elements in logistics value proposition.
Goals to be achieved
Logistics shares the goals of supply chain management, to meet the customer requirement. Several goals of logistics management are accepted by the experts internationally, which include:
- Retort quickly to the changes in the market or customer orders
- Curtail adjustments in logistics service
- Minimize inventory to cut expenses
- Consolidate product movement by group shipments
- Deliver high quality throughout the process
- Support and protect the entire product life cycle
- Manage reverse logistics, if needed