In a general sense, logistics is the process of movement of goods from one place to another. More specifically, the concept is used to describe the part of supply chain management which undertakes the movement function. The goods movement can be in reverse and forward direction.
“Logistics management is that part of supply chain management that plans, implements, and controls the efficient, effective forward and reverse flow and storage of goods, services and related information between the point of origin and the point of consumption in order to meet customers’ requirements.
The process of integrating the moving and maintenance of goods in and out the organization is logistics.
If we borrow the words of Helsinki, logistics is, a business planning framework for the management of material, service, information and capital flows. It includes the complex information, communication and control systems required in today’s business environment.
Types of Logistics
Logistics can be divided into three different phases, ie., Inbound Logistics , outbound logistics ,Reverse logistics.
Inbound logistics is that part of logistics which manages the transport, storage and delivery of goods coming into a business. Inbound logistics are an integral element of business operations of a manufacturing firm, involving the processes of receiving, storing and distributing raw materials for use in production.
Outbound logistics is that part of logistics which moves goods out of a business which involves the movement of finished goods from the warehouse to the point of consumption. Inbound and outbound logistics combine within the field of supply-chain management.
Reverse logistics is for all operations related to the reuse of products and materials. It is “the process of moving goods from their typical final destination for the purpose of capturing value, or proper disposal. Here the flow of goods is in reverse order in which goods are moving from the consumer to the manufacturer. There are many reasons for reverse logistics like a customer can return a product due to manufacturing defect, wrong delivery, variation in terms of purchase, product recycling and so on.
Logistics and Supply Chain
Nowadays people use the terms logistics and supply chain interchangeably. However, both these terms are different in nature. Logistics is typically considered a sub-set of SCM. Supply Chain‘ is a broader topic that covers demand
Planning/management, supply planning/management, capacity planning, strategic procurement, factory scheduling and logistics. SCM caters five key functions which include, Procurement, Manufacturing, Move, Store, and Service.
“Logistics activities are managed within a single organization and supply chains refer to networks of companies that work together. Also, traditional logistics focuses on activities such as procurement, distribution and inventory management. Supply chain management also includes marketing, new product development, finance, and customer service”