Logistics is a science, the subject of which is the organization of a rational process of movement of goods and services from suppliers of raw materials to the consumer, the functioning of the sphere of circulation of products, goods, services, management of stocks and provisions, and the creation of infrastructure for commodity circulation.
A broader definition of logistics interprets it as the doctrine of planning, management and control of the movement of material, information and financial resources in various systems.
From the point of view of the management of an organization, logistics can be viewed as a strategic management of material flows in the supply process: purchasing, transportation, sale and storage of materials, parts and finished inventory (equipment, etc.). The concept also includes the management of relevant information flows, as well as financial flows. Logistics is aimed at optimizing costs and streamlining the process of production, sales and related services both within one enterprise and for a group of enterprises.
The semantics of the word "logistics" goes back to Ancient Greece, where "logistics" meant "counting art" or "the art of reasoning, computing."
Historically, you can trace two main interpretations of the term that have survived to this day. The first (and original) is related to the military field.
Here, logistics is defined as the practical art of command and control and includes a wide range of issues related to planning and managing the logistics of the army, determining the location of troops, transporting the army, etc.
The second is with mathematical logic. This term was used in the works of the famous German mathematician G. Leibniz (1646-1716). This value was assigned to logistics at the Philosophical Congress in Geneva in 1904
The most famous definition cited by most foreign university textbooks is the definition: “Logistics is the process of planning, executing and controlling cost-effective flow of stocks of raw materials, materials, work in progress, finished goods, service and related information from the point of its origin to the point of consumption (including imports, exports, internal and external movements) to fully meet the requirements of consumers. "
Three points are important in this definition. Firstly, the fact that logistics activities are integrated and cover the process from the place of origin to the place of consumption of the flow of material resources and finished products. Second, the importance of managing related information is emphasized. And, finally, thirdly, for the first time in the sphere of interests of logistics has got service, i. intangible activity. This is of fundamental importance for the development of logistics approaches in the service industry. So, earlier the object of study and optimization in logistics was only material flows.
The concept of a logistics system is central to logistics. A complex organizational system, consisting of fragments of links, united in one process of managing material and related processes, is logistic. The tasks of the functioning of the links of the system are united by the internal tasks of the business structure or by external goals.
Material flows in the links of the logistics system can converge, split, branch, change their content, parameters and intensity. Enterprises-suppliers of material resources, sales, trade, intermediary organizations of different levels, enterprises of information and trade services and communications can act as elements of the logistics system.
Each area of logistics activity is constantly in need of optimization. This will allow achieving the maximum economic effect with minimum production costs.
The company's turnover and costs depend on the efficiency of logistics management at the enterprise. With a properly built strategy for the delivery of goods, the monthly turnover will increase, due to a noticeable decrease in the costs of transportation and storage of resources. Below we will consider the basics of the logistics of organizing any type of activity and methods for improving it, which will help optimize production cycles.
She is mainly responsible for purchasing, supplying and marketing, transporting and storing goods, materials, raw materials and other values. Logistics at the enterprise is used in order to optimize the costs associated with the movement of goods and materials. This concept also implies the management of information resources that ensure the optimization of logistics processes at the enterprise.
In simple words, this is an activity aimed at managing material, information and personnel flows operating within the framework of one project/company. The department is engaged in the development of a methodology, a scientific approach for the effective movement, storage and distribution of enterprise assets. The activity covers all stages of production, from the primary supplier of raw materials to the delivery of the finished product to consumers.
Activities are divided into two types:
The tasks of external logistics include:
The main functions of the logistics department include:
What will global logistics look like in 2021 and beyond, what trends will affect the industry? Despite the global trade crisis due to the pandemic, 2020 has been an exciting and important year for the global supply chain. While the future is always uncertain, there are major supply chain trends and forecasts for 2021. From digitalization and blockchain, Industry 4. to the adoption of IoT and smart contracts.
Top 6 Global Supply Chain Trends to Watch Out for in 2021:
With the emergence of Industry 4. supply chains are rapidly moving towards a connected, intelligent and highly efficient logistics ecosystem. Digitalization is bringing innovation to an industry that was previously constrained by outdated systems and approaches.
This makes the global chain a fully integrated ecosystem that is completely transparent to all players involved. From suppliers of raw materials, components and parts to carriers of these materials and finished products, as well as customers requiring fulfillment.
Since blockchain is known for its ability to be transparent, it will be widely used in global logistics (like supply chain blockchain). Blockchain technology has grown and has proven itself in a variety of industries.
Research shows that in the food and beverage industry alone, blockchain could save $ 31 billion by 2024. Secure data sharing is one of the challenges in global supply chains. The use of blockchain allows the exchange of data in the supply chain from start to finish with all stakeholders.
Building a sustainable “green business ecosystem” has become a popular trend in today's digital world. Supply chains are no exception. The concept of green supply chain management means the integration of sustainable environmental processes into traditional supply chains.
Since electricity and transport make a huge contribution to greenhouse gas emissions, green logistics is rapidly gaining momentum among many companies today. Sustainable supply chain management involves stimulating value creation in supply chain organizations to reduce the overall environmental impact.
Because the IoT brings together interconnected physical devices that can track, report, send and share data, it will be effective in supply chains. IoT devices can track and authenticate products and shipments using GPS and other technologies.
Hello, dear readers of the HeatherBober business magazine. u! Eduard Stembolsky is in touch.
When doing business, the organization and transportation of products is very important for expanding the geography of the company. Many entrepreneurs face the problem of cargo transportation.
In this article I will cover the main issues related to transport logistics, as well as give specific recommendations for choosing a transport company.
Have a comfortable seat, we're starting!
The modern market of transport services is replete with a large number of proposals. In the conditions of the created competition, transport logistics companies are trying to offer the most favorable conditions for cooperation for customers.
But how can a person who is not familiar with the organization of work of transport companies choose a reliable contractor? Who can maximize productivity at the lowest cost? Let's try to figure it out. We already wrote about what logistics is in the previous article.
First, you should familiarize yourself a little closer with the basic terms. What is transport logistics?
In your own words, such a concept can be explained as a mechanism for managing the transportation of goods. The transportation of finished products or necessary components to support the production process is a component of commercial success.
Transport logistics is a system for organizing cargo delivery with minimal time costs and optimization of delivery costs.
Transport logistics can be internal and external. The first one provides in-house transportation, and the second one provides supply to enterprises and sales of finished products.
Transport logistics means a system for organizing the delivery of goods with a minimum amount of time spent on transportation, optimization of delivery costs. An entrepreneur needs to solve the problem of transportation on his own, with the organization of his own logistics enterprise or with the involvement of third-party companies that provide cargo transportation services.
The basis of transport logistics includes the following functions:
Additional services may include insurance and customs clearance.
Due to well-functioning schemes for moving goods using cargo transportation, enterprises can sell products, receive raw materials from other companies.
Cooperation allows you to reduce the likelihood of risk and improve relationships with companies, both in the country and abroad.
Using the rules of transport logistics allows you to deliver special cargo in any of the selected directions. The key parameter when choosing a transportation option is a preliminary calculation of the capacity and carrying capacity of transport, the safety of goods and a decrease in the amount of costs for the movement itself.
Transport logistics is an important subsection. A novice entrepreneur with his own production at the initial stages of activity does not need third-party assistance in the delivery of goods: he can independently purchase raw materials and transport finished products.