What is Logistics?
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Logistics, in its most basic definition, is the efficient flow and storage of goods from their point of origin to the point of consumption. It is the part of the supply chain process that plans, implements and controls the flow of goods. It can also be seen as the management of inventory, in rest or in motion. The word logistics was first used in the military service to describe the process of supplying a war zone with troops, supplies and equipment. The term is now used more commonly in the field of business. A recent US study found that logistics costs account for almost 10% of the gross domestic product. The process itself covers a diverse number of functional areas. Involved in logistics are transportation and traffic, as well as shipping and receiving. It also covers storage and import/export operations. The concept of logistics can be applied to specific areas of business. Acquisition logistics, for example, covers everything involved in acquiring logistics support equipment and
The Concept of Logistics One of the most asked questions in military circles is what exactly is logistics? Before I go any further, I want to clarify a few things. First is that there is no standardized definition of logistics so it tends to live a rather ad hoc existence, more like a black art than a military function. Second is that I have no formal training in logistics and every time I meet someone who does, I thank God that I don’t. Consequently, all definitions provided herein are my own. Third is that while each branch of the military has its own concept and methods of logistics, I refuse to acknowledge any such distinctions. Somwhere, somehow, we need to learn to play together. Logistics is the art of enabling war. The infantry shoots their guns, the artillery blows things up, the planes drop their bombs, the engineers help them do all this, the medics piece all those folks back together, intel makes sure we’re killing the right folks; without logistics, none of this happens. I
A recent study defined logistics as: That part of the supply chain process that plans, implements and controls the efficient flow and storage of goods, services and related information from the point of origin to the point of consumption, in order to met the customers’ requirements. Today’s modern, efficient warehouses/distribution centers are the heart of logistics, and provide control, efficiency and velocity for goods moving through the system. A bit broad, but the elements that make up the modern logistics industry continue to evolve as the breadth of value added services warehouse logistics providers offer does. This expansion has been accelerated by three vital trends in the new economy: • The general trend toward outsourcing, • The previously unprecedented growth of e-commerce and • The importance of the partnership aspect of the manufacturer/marketer-logistics provider relationship. A recent study found that 95 percent of the U.S.’s chief executives believe they should have som
Logistics is one of those words that you cannot seem to nail down in our business. Everyone seems to use it in their own way. All of a sudden, an air freight company is now into “logistics”. What s the difference between “logistics” and “freight forwarding”? With all of the companies out there in the transportation industry adding the word “logistics” to their company name, it s hard to tell if they are just adding words, or if something is really changing in our business. A good starting point in the search for an answer is one definition of the term Logistics, from the Council of Logistics Management, the industry s most prestigious group: Logistics is: “The art and science of obtaining, producing and distributing material and product in the proper place and in proper quantities….” The activities include, but are not limited to: warehousing, transportation, private fleet, inventory control, purchasing, production scheduling, customer service and long range planning. A survey by the
