TABLE OF CONTENTS

Introduction 1

1. Relation to Supply Chain Management 2

2. Different Types of Logistics Management

2.1 Supply Management and Logistics 2
2.2 Distribution and Material Movement 2
2.3 Production Logistics and Management 2
2.4 Reverse Logistics and Product Return 2

3. The Distribution Network of Logistics Management 3

4. Key Challenges Faced by Logistic Managers

4.1 Fuel Costs 3
4.2 Business Process Improvement 3
4.3 Better Customer Service 3
4.4 Manpower Management 3
4.5 Environmental Issues 4
4.6 Technology Development 4
4.7 Reverse Logistics 4
4.8 Inventory Control and Visibility 4

5. Steps for Smart Logistics Management 5

6. Why is Logistics Management Important? 6

References 7
I. Introduction
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Logistics management is the process of strategically managing the procurement, movement and
storage of materials, parts and finished inventory (and the related information flows) through the
organization and its marketing channels in such as way that current and future profitability are
maximized through the cost-effective fulfillment of orders. When it comes to business, that
process is the flow of work from the beginning to the end, in order to fulfill customer
expectations as well as those of your organization.

Logistics management manages resources that can range from tangible goods (such as materials,
equipment and supplies) to food or other consumable items. In doing so, logistics management
deals with integrating the flow of information and its management tools, materials handling,
production packaging, inventory, transportation, warehousing and sometimes security.

To model, analyze, visualize and optimize this complex logistical puzzle, the use of a dedicated
simulation software is often used. A person who works in this field is called a logistician.
 Relation to Supply Chain Management
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Logistics management is a subset of the larger supply chain management. Supply chain
management plans, implements and controls the efficient flow of storage, goods, services and
related information from the point of origin to the point of consumption. This is done for the
purpose of meeting the requirements of customers.

Logistics management in business works across all industries. Its aim is to manage the fruition
of project life cycles, supply chains and resultant efficiencies. As businesses grow more complex
and expand into a global marketplace, business logisticians have evolved into something called
supply chain logisticians.

With logistics management in business the focus is twofold: inbound logistics for internal
functions and outbound logistics for the external flow from the point of origin to the point of
consumption. Logisticians focus on inventory management, purchasing, transportation,
warehousing, consultation and the organization and mapping of these processes.

Different Types of Logistics Management

There are four main types of logistics management, each emphasizing a different aspect of the
supply process.

1. Supply Management and Logistics

This involves the planning, procuring and coordinating materials which are needed at a certain

time at a particular place for the production of a task. This includes transportation of the
materials as well as a place to store them. Additionally, evaluating the level of supply at the
different stages of the process is required to make sure the needs of the customer are met, for
example delivering materials to a construction site or parts for a manufacturing plant.

2. Distribution and Material Movement

This takes stored materials and transports them to where they need to go. The issues in this
involve moving materials; including loading, unloading and transportation, as well as keeping
track of the stock and how it is used. This type of management controls the movement of
supplies from a central warehouse to the stores that sell the product to the public.

3. Production Logistics and Management

This manages the stages of combining distributed supplies into a product, such as coordinating
what is needed to make or put together something. This involves the staging of materials at the
right time to work with the building of a product. This stype of logistics management falls in the
realm of product management.

4. Reverse Logistics and Product Return

This is about the management of reclaiming materials and supplies from production. For
example, on a construction site it involves the removal of excess material and returning 2those
materials to one’s stock. It can also refer to the return of unwanted or unused products from the
end customer seeking a refund.

The Distribution Network of Logistics Management

The various links and points of distribution in a logistics management network include the
following:

1. Factories that manufacture products

2. Warehouses that store products
3. Distribution centers to receive and return items for clients
4. Transport to deliver product
5. Retail locations, from small to larger stores to sell product

These are the major hubs for the logistics of a product, though there can be vendors and
intermediaries operating between these points.

Key Challenges Faced by Logistics Managers

1. Fuel Costs

One of the biggest logistics challenges of the past years is the cost of fuel. Higher fuel prices will
significantly affect the cost of wages and transportation for shippers.

2. Business Process Improvement

Staying on top of new advances in business processes is another challenge to keep an eye out for
this year. As new opportunities arise, it will serve to your advantage to adapt and implement
these changes to offer better service and to increase efficiency within your operations. However,
this can be costly and challenging without the right assistance. A 3PL provider or fourth-party
logistics (4PL) company will work as an extension of your business to help you repair any
broken or weak links in your supply chain. They will help you improve your process by offering
planning, strategy, and services that work in your favor.

3. Better Customer Service

Today’s customers expect certain features when they order from your online store. They want to
receive tracking information and real-time updates to keep them aware of where their order is
along the shipping and delivery journey. They also want the option to pay for faster shipping,
such as two-day or same-day shipping. Anything more than this is considered unacceptable and
may deter customers from following through with the purchase. A 3PL provider can help you
achieve full visibility throughout your supply chain so you can provide your customers with the
information they need.

4. Manpower Management
Another challenge in today’s logistics industry is managing manpower. Dealing with your
warehouse staff, drivers, transporters, etc. are some of the most vital requirements that should be
handled in a respectful and efficient way. Your team needs to have the ability to communicate 3 at
any point in time to ensure coordination and a smoother movement of your goods. Logistics
companies can help you manage your employees better by providing managers in major
locations, quality communication, and scheduling solutions.

5. Environmental Issues
Reducing greenhouse gas emissions is one of the major goals for many companies this year,
especially after numerous studies have shown the negative impact big business supply chains
have on the environment. Companies that adapt and reduce their carbon footprints succeed better
because both partners and consumers are more aware than ever before. Choosing a 3PL that
strives to find ways to reduce gas emissions and waste will serve you well. Solutions include
using geographical positioning systems (GPS) to find more efficient routes to ship and deliver, or
recycling materials from returned goods to put back into manufacturing, instead of disposing
them as waste.

6. Technology Development
The cost of adapting to new technology used in the supply chain is high, but it is a requirement to
survive in the competitive industry. A 3PL partner will resolve this issue, as many of these
organizations are already equipped with the necessary technology to increase efficiency. Some of
these technologies include radiofrequency identification for barcoding and scanning (RFID),
communication tech like electronic data interchange (EDI) and GPS, and material handling
technology. Implementing these technologies on your own is extremely expensive, which is why
you would benefit from partnering with a 3PL provider.

7. Reverse Logistics
Reverse logistics is required by every e-commerce business. Customers need a way to return
items they’ve purchased if they are dissatisfied with them, and this process needs to run
smoothly. Without an efficient reverse logistics platform, you can turn off customers and prevent
them from ever buying from you again. However, a reverse logistics strategy can be challenging
and costly, without the right support. A 3PL provider can help you face these challenges with
their preexisting robust solutions. They can help you process returns in a timely manner to satisfy
your customers, and can help you decide what to do with returned items to prevent revenue loss.
These solutions may include repackaging unused items for resale or refurbishing items to sell at
a discounted price.

8. Inventory Control and Visibility

Knowing what inventory you have on hand, and where it is located at any moment are the
primary aspects of inventory visibility. This aspect is critical to every e-commerce and retail
business, but gaining this visibility and control can be challenging. A 3PL provider can provide
you with this visibility through their use of technology in the warehouse. They can help you
make more efficient use of your time, improve predictability of inventory movement, increase
security and quality control, and more.
 Steps for Smart Logistics Management
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Logistics management involves a lot of planning: the more steps, the better. By considering
every stage of the product, its distribution and the return of materials and supplies, you’re more
likely to increase efficiencies and increase revenues.
The larger the operation, the more complex and difficult the logistics management. Therefore,
the more you need a strong logistics management plan. In order to be prepared and have the best
plan possible, the following are some tips to follow.

Have a Strong Plan: Like any management, it succeeds or fails on the strength of the plan. The
more thorough your plan, the less you’ll have to think on your feet. There will always be issues,
and only so much potential risks you can plan ahead for, but planning early and in detail can help
mitigate delays and other obstructions to the clear flow of materials and supply.

Make a Plan B: No matter how good your initial plan is there can always be something that
comes along that it cannot manage. That’s why you need a contingency plan for every element of
your logistics plan to respond to unforeseen problems that might arise. But it’s important to also
know when to give up the original plan and move on to the secondary one.

Hire a Manager: It’s critical that this process has a leader who is experienced and able to work
with a variety of different parties, all of who are involved in the logistics of the materials and
supplies. That means interpersonal skills are a must. They should also have strong industry
contacts in order to deal with any last-minute logistics changes in suppliers, etc.
Automate: It goes without saying that automation is a built-in way to make workflow more
efficient. The are so many processes that can be helped through task automation, from tracking
to monitoring delivery to fleet and inventory management software.
Learn from Mistakes: This goes for most everything. You’ll take missteps on your journey of
managing logistics. That’s a given. What’s not assured is that you’ll learn from those mistakes,
so they don’t happen again. Therefore, take time to look back on what you’ve done, where 5 it
worked and where it didn’t, and get feedback from your team.

Why Is Logistics Management Important?

The purpose of logistics management is obviously about finding more efficient and effective
ways to move resources and products from conception to completion and, finally, to the
customer. But the driving force of these actions is to meet customer demand and provide the best
service possible to retain customers and maintain their satisfaction by meeting their
requirements.

As customers demand better service, there’s a need to ship faster, more accurately and with a
high level of quality. It is through logistics management that customer satisfaction is achieved.
But that’s not the only benefit of logistics management. It also helps to create visibility in the
business’ supply chain. By analyzing the historical data and tracking the real-time movement of
goods, logistics managers can better the flow of materials and avoid any potential disruptions.

Therefore, logistics management helps drive up revenue. It improves customer service, adds to
the company’s good reputation and brand, which in turn creates new and more business. With
more visibility into the supply chain there is the opportunity to save costs in operations, by
controlling inbound funds, keeping inventory at the right level and organizing the reverse flow of
goods.
 REFERENCES
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[1] Logistics Management (Definition) - What is Logistics Management? | SCM | Supply
Chain Resource Cooperative (SCRC) | North Carolina State UniversitySupply Chain
Resource Cooperative | NC State University (ncsu.edu)

[2] Logistics Management 101: A Beginner's Guide - ProjectManager.com

[3] Top 8 Logistics Challenges Facing the Industry - Logistics Management

(logisticsmgmt.com)