• Logistics management tries to have the “right product”, in the “right quantity”, at the “right place”, at the “right time”, with the “right cost”

• Logistics = Supply + Materials management + Distribution

COMPONENTS OF LOGISTICS

• Logistics' components are the foll:-1. Procurement 2.Manufacturing3.Distribution4.Storage and warehousing5.Information systems and management6.Customer service

Procurement

• Procurement logistics consists of activities such as market research, requirements planning, make-or-buy decisions, supplier management, ordering, and order controlling. • The targets in procurement logistics:maximizing efficiency by

concentrating on core competences, outsourcing while maintaining the autonomy of the company, or minimizing procurement costs while maximizing security within the supply process.

Inventory

• Inventory management is primarily about specifying the size and placement of stocked goods• Systems and processes that identify inventory requirements, set

targets, provide replenishment techniques and report actual and projected inventory status

Inventory

• Inventory management is an important because inventories are usually the largest expense incurred from business operations

• Most companies will use an inventory management system that will track and maintain the inventory required to meet customer demand.

• A truly effective inventory management system will minimize the complexities involved in planning, executing and controlling a supply chain network which is critical to business success.

Transportation

• Logistics in this case details out the mode of transportation from the vendor, the consignment planning, process for order trigger, consolidation of shipments, detailing transportation modes and vendors, defines transit times, documentation process and implements the plan, controls and monitors the flow of goods from point of origin up to the point of delivery to the plant for production.

Transportation

• Key modes• 1. Air• 2. Land• 3. Sea• 4. Rail

Warehousing

• Space determination, • stock layout,• configuration,• stock placement)

Value Added Logistics