Logistics and distribution

management
Logistics
Logistics is used more broadly to refer to the process of coordinating
and moving resources – people, materials, inventory, and equipment –
from one location to storage at the desired destination.

The term logistics originated in the military, referring to the movement

of equipment and supplies to troops in the field.

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Common Definition
• Logistics is the management of the flow of things between the point of origin and
the point of consumption in order to meet requirements of customers or
corporations. (Wikipedia, 2016)

• Logistics Function
Reverse Logistics

Order Processing
Warehousing
Transportation
Facility 1 Facility 2
Packaging and Inventory
material handling Management

Managing outsourced functions

Coordination & Risk management
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Logistics Retailer
Retailer

Warehouse Retailer

Supplier Retailer

Retailer
Supplier Warehouse Factory
Retailer Retailer

Supplier Warehouse Retailer

Retailer
Supplier

Retailer Retailer
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Defining Logistics Management (1)
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.
(Council of Supply Chain Management Professionals, 2016b)

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 Logistics and distribution
management
Understanding logistical integration
eg. 3PL, 4PL concepts
Understanding logistical integration
• 1PL
• 2PL
• 3PL
• 4PL
Supplier Customer
Seller Buyer
Sender Receiver

Tangible Intangible
Fleet Knowledge/ Experience
Manpower Expertise/ Skills
Material handling equipment Connectivity/ technology
Capacity Strategic management

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1PL

Supplier Customer
Seller Buyer
Sender Receiver

Tangible Intangible
Fleet Knowledge/ Experience
Manpower Expertise/ Skills
Material handling equipment Connectivity/ technology
Capacity Strategic management

8
2PL

Supplier Customer
Seller Buyer
Sender Receiver

Intangible
Knowledge/ Experience
Expertise/ Skills
Connectivity/ technology
Tangible Strategic management
Fleet
Manpower
Material handling equipment
Capacity

9
3PL

Supplier Customer
Seller Buyer
Sender Receiver

3PL
Tangible Intangible
Fleet Knowledge/ Experience
Manpower Expertise/ Skills
Material handling equipment Connectivity/ technology
Capacity Strategic management

1
0
4PL – Case 1

Supplier Customer
Seller Buyer
Sender Receiver

4PL
Intangible
Knowledge/ Experience
Expertise/ Skills
Connectivity/ technology
Strategic management
Tangible
Fleet
Manpower
Material handling equipment
Capacity

1
1
4PL – Case 2
Supplier Customer
Seller Buyer
Sender Receiver

4PL
Intangible
Knowledge/ Experience
Expertise/ Skills
Connectivity/ technology
Strategic management

3PL 3PL 3PL 3PL 3PL

1
2
4PL – Case 3
Supplier Customer
Seller Buyer
Sender Receiver

4PL
3PL
Tangible Intangible
Fleet Knowledge/ Experience
Manpower Expertise/ Skills
Material handling equipment Connectivity/ technology
Capacity Strategic management

3PL 3PL 3PL 3PL 3PL

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3
CROSS DOCKING AND JIT
CONCEPTS
CROSS DOCKING

In crossdocking, the inbound materials coming in trucks to the cross

dock facility are directed to outbound doors and are directly loaded
into trucks that will perform shipment, or are staged for a very brief
time period before loading. It has got an immense potential to bring
savings in the overall logistics system of a company.
Advantages of Cross-Docking

• Decreased labor costs

• Decreased Material Handling
• Improved Lead time
• Storage area can be saved
• Decreased damages
Disadvantages of Cross-Docking

• Management Issues
• Limited Capital Investment
• Not feasible in various situations
• Increased costs of trucks and docks
• Inefficiency in low turn over setups
JUST IN TIME CONCEPT

Just in time concept is type of lean methodology designed to accelerate

efficiency, cut costs and diminish waste by receiving goods only as they
are required.
ADVANTAGES OF JUST IN TIME

• Waste reduction
• Less Space needed
• Smaller Investment
DISADVANTAGES OF JUST IN TIME

• Lack of Control
• Risk of running out of stock
• More planning required
Belt and Road Initiative
The belt and road initiative (BRI) is considered one of the most
important global development strategies ever made by the Chinese
government. It is estimated that the worth of the belt and road is
around USD 1 trillion comprised of approximately 1700 different
projects.
Opportunities and Risks
Opportunities

• Increased integration and connectivity

• Expansion of Trade
• Improvement in existing supply chains
• Job Creation
• Creation of new supply chains
Risks

• Political Risks
• Inflated Expectations
• Complexity
• Performance issues
• Sustainability concerns
Emerging trends of Sustainability in
Supply Chain Management
Emerging trend of Sustainability

The concept of Sustainability in Supply Chain Management has gained

momentum recently. Contemporary Supply Chains are focusing on
Sustainability as a tool to augment their performance. The principle of
Sustainability in Supply Chain Management is based upon the
foundation that we must meet the needs in such a way that the needs
of future generations are not obstructed. Sustainability in Supply Chain
Management can improve the overall financial position and growth
prospects of a company. Sustainable operations help organizations to
manage risks resulting from both internal as well as external risks.
Triple Bottom Line

Triple Bottom Line in Sustainability means that there should be a

balance among the following dimensions:
1.Environment
2.Economic
3.Social
Driving forces and barriers of Sustainability in
Supply Chain Management