Compiled By:Rohit Kumar Sharma Gaurav Mukhija

"Logistics means having the right thing, at the right place, at the right time."

Word, Logistics is derived from French word loger, which means art of war pertaining to movement and supply of armies. Logistics means the art of managing the flow of raw materials and finished goods from the source to the user To get goods from where they arise to the right place in the right form, at the right time, at the right cost, Logistics or physical distribution or distribution logistics is an integral part of Marketing Process.

Scope of logistics

Company choosing the markets in which it wants to operate. Deciding on plant location and layout. All aspects of inventory management including costs and service levels. Customer services policies. Extent of distribution network to be built up. Location and management of storage facilities. Choices of mode of transport, selection and management of carriers.

Key logistic activities

Customer services

Demand forecasting
Inventory control Materials

Distribution communication

handling Order processing After sales parts and services report

 Plant

and warehouse site location Procurement Packaging Warehousing and storage

Logistics and marketing

Product Pricing Market

design

and demand forecast Customer services policies Number and location of warehouses Inventory policies Order processing

Focus Areas
Inventory

management Storage and warehousing Transportation

Inventory management
Objectives 1. To maximise customer service

2. Help minimise the cost of plant

operations 3. Minimum investment to deliver the agreed customer service

Categories of inventory
Anticipation Safety or fluctuation Lot size Transportation Hedge Maintenance

Reasons for carrying inventory

Pipeline stocks Cycle stocks Seasonal stocks Safety stocks

Inventory management and control

ABC classification

Warehousing

Reasons for warehousing

o To support companys customer service policy o To maintain a source of supply without

interrruptions o To achieve production economies in terms of setup times o To achieve transportation economies o To support changing market conditions o To provide customers with right mix of products at all times and all locations

Warehouse location strategies

Market positioned Production positioned Intermediately positioned

Warehouse site selection factors

Location of major markets Nature of product Labour Cost of land Potential local tax structure Utilities

Transportation

Selection criteria

Transport rate related variables

Customer services capabilities Handling equipment for specific products

Advantages of transportation
Greater economies of scale Provides opportunities for business Better customer services

THANK YOU