LOGISTICS AND

SUPPLY CHAIN
MANAGEMENT

Day 3:
Key Components of Logistics

Dr. Ramil David Solis, DBA

Professor

03DEC2023
 TOPIC PRESENTATION

v Key Components of Logistics

• Meaning and Definition of
Logistics Management
• Major Components of Logistics
Management
• Functions of Logistics
• Difference between logistics and
supply chain management
 Logistic
Management
• is complex and fundamental
for companies in managing their
supply chain.
• key components create and
enforce consistency in the
movement of goods from
manufacturer to distributor or
consumer.
• It defines the logistics
activities within the supply
chain.
 6 Benefits of
Logistics
Management

1. Visibility
2. Reduced overhead
3. Improved customer experience
4. Preventing loss
5. Support expansion
6. Competitive edge
6 Benefits of
Logistics
Management 1. Visibility
§ affords greater visibility into the supply chain.
§ enables businesses to better control costs, tease
out efficiencies, spot supply chain problems,
conduct demand planning
§ gain insights into opportunities.

2. Reduced overhead

§ enables companies to reduce overhead in areas

from cutting shipping costs to shrinking how
much warehouse space they need by proactively
controlling inventory levels.
3. Improved customer 4. Preventing loss
experience
• An excellent customer • helps prevent loss using the
experience (CX) is the inventory accounting system,
driving factor behind repeat
• It tracks movement and current
sales.
location of the stock to avoid
• By delivering orders misplaced or diverted without notice.
accurately and quickly, you • ensuring optimal storage and
improve the customer transport conditions, such as
experience which in turn temperature and moisture
increase brand loyalty and management, solid logistics to
future sales. prevents spoilage and damage.
5. Support expansion

§ Demand forecasting supports expansion by realistically calculating

inventory needs and ordering, transporting and stocking

§ Logistics management best practices help companies scale to fulfill

more customer orders on time.

6. Competitive edge

§ Delivering orders correctly and on time is a foundational element in the

customer experience—and good CX is key to repeat orders as well as
solid brand reputation and net promotor scores, which in turn help a
company acquire new buyers.

§ Logistics management helps a company consistently deliver, or over

deliver, on promises and sharpen its competitive edge.
 To improve the process, we need to dive into the key components of
Major logistics management:

Components v Demand Planning

of Logistics v Storage and Materials

Management v Inventory Management

v Transportation Management

v Information and control

1. Demand planning

To guarantee customer order fulfilment, demand

planning is an essential logistics function. By
ordering merchandise in the correct quantities
and at the right price and mobilizing suitable
transport, customer demand is meets and profits
protected.
2. Storage and Materials
• Because demand is unpredictable,
it’s important to have surplus goods on
standby until consumers demand them.
Warehouses are responsible for the
storage, care, retrieval, packaging, and
unitization of merchandise.

• Warehouse management systems

(WMS) optimize storage capacities,
equipment (forklifts, for example),
retrieval speeds, and warehousing
processes.
3. Inventory
Management

• Inventory management
controls the flow of goods
in and out of a warehouse.

• It dictates how much

stock to hold and where
to locate it using targeted
data to predict consumer
demand.
4. Transportation Management
Logistics involves mobilizing different modes of transport to
move merchandise from one stage of the supply chain to
the next.

Merchandise might need to travel via road vehicles, freight

trains, shipping, or even air travel for long-distance supply
chains using transportation management software.

Consolidation is the process by which shipping companies

or carriers combine multiple smaller shipments in one. This
speeds up deliveries and keeps costs low.
5. Control

• Logistics is a complex operational procedure that requires a lot of

precise information to be effective.
• Forecasting demand, transportation times, and inventory are crucial to
keeping the operations to a tight timescale.
7 R’s of Logistics
Management
• Get the right product
• At the right quantity
• At the right time
• In the right condition
• To the right place
• And to the right customer
• At the right cost
Steps in Recycling Logistics