Logistics

Logistics is an important part of how things get from one place to another. It helps manage the movement of goods, services, and information from where they start to where they are needed. A person who works in this field is called a logistician.

In the military, logistics makes sure armies have what they need, like food and supplies, during operations. For everyday life, logistics helps move things like raw materials, products, and even garbage from one place to another. It is different from the work that happens inside factories where things are made.

Logistics can cost a lot of money for businesses and countries, so many use special computer programs to help plan and improve how they move things. The goal is often to use fewer resources and make the process better for everyone.

Nomenclature

The word logistics has been used in English since 1846. It comes from the French word logistique. A Swiss military officer and writer named Antoine-Henri Jomini helped popularize this term. He explained that the word comes from the French word logis, meaning 'lodgings'.

Some people argued that the word logistique might actually come from an old mathematical term from Ancient Greek, rather than from the idea of lodgings. Even though there was some debate about its origin, the term stuck and is now used to describe the organization of moving and managing resources.

Definition

Logistics is all about organizing how things move from one place to another. It helps make sure goods, like food or toys, get to where people need them. This can include planning how to transport these items and storing them properly until they are ready to be used or sold.

People who work in logistics help coordinate many details, like when and where things should be delivered. They make sure everything happens smoothly, just the way customers want it. This important work helps connect factories, stores, and homes, making sure we all get the things we need.

Logistics activities

Logistical activities can be divided into three main areas: order processing, inventory management, and freight transportation. Modern freight transportation uses fleet management to work more efficiently and safely. Order processing used to take a lot of time, but now computers and bar code scanning let us check stock quickly. Having inventory helps save money and serve customers better, but it needs space and money to keep up. Freight transportation is important because it lets people and businesses get products from far away.

E-commerce has created something called "e-logistics." This handles small packages worth less than a hundred US dollars and delivers them all over the world. Unlike regular logistics, e-logistics can have busy times when lots of people want things at once.

There are several types of logistics:

• Procurement logistics helps get the things a business needs.
• Advance logistics gets supplies ready before they are needed.
• Global logistics moves goods between different countries.
• Distribution logistics delivers products to customers.
• Disposal logistics deals with getting rid of waste.
• Reverse logistics handles returning and reusing products.
• Green logistics tries to make logistics better for the environment.
• RAM logistics looks after very important machines and systems.
• Asset control logistics tracks items used to show or sell products.
• Humanitarian logistics moves goods quickly during emergencies.

Production logistics makes sure factories have the right materials at the right time. Construction logistics helps move big tools and materials for building projects.

Seven R's

The Seven R's is a helpful idea used in logistics to make sure everything is done the best way possible. It includes making sure you have:

• The right product (and the right information about it)
• The right quantity
• The right time
• The right condition
• The right place
• The right customer
• The right financial resources

Military logistics

Main article: Military logistics

In military operations, keeping supplies moving to soldiers while stopping the enemy from getting theirs is very important. Great leaders like Hannibal, Alexander the Great, and the Duke of Wellington were experts at planning how to give their troops what they needed.

Armies need strong logistics to work well. Special officers called Logistics Officers decide when and where to send supplies. They study how much of different items will be needed, like food, fuel, or repair parts, depending on whether it is peacetime or war. Good planning helps armies stay strong and ready, while poor planning can make them weak and slow.

Business logistics

One definition of business logistics is having the right item in the right quantity at the right time, at the right place, for the right price, in the right condition, and for the right customer. Business logistics includes all industry sectors and aims to manage project life cycles, supply chains, and improve efficiency.

The term business logistics has grown since the 1960s because supplying businesses with materials and shipping products has become more complex in a globalized world. This has led to the need for professionals called supply chain logisticians.

In business, logistics can focus internally (managing materials coming into a business) or externally (managing products leaving the business). It covers moving and storing materials from where they are made to where they are used or sold. This is a key part of supply-chain management. Main tasks for a logistician include inventory management, purchasing, transportation, warehousing, and planning these activities. Logisticians use their knowledge to organize resources in a business.

There are two main types of logistics: one focuses on keeping materials moving smoothly through transportation and storage points, while the other coordinates resources for specific projects, like setting up a new warehouse.

A journey planner or route optimization software helps find the best paths for vehicles to deliver goods. These tools are part of an intelligent transportation system and consider traffic, delivery times, and vehicle capacity to save fuel and ensure timely deliveries.

Nodes of a distribution network

A distribution network needs several places to move goods from makers to users. These places can add to the cost but help by lowering transportation expenses. The number of these places depends on the type of goods. For example, cosmetics might be sold directly from door to door, while industrial equipment might not need extra places.

The key points in a distribution network include:

• Factories where products are made
• A depot or warehouse for storing goods
• Distribution centers for processing orders (with less storage)
• Transit points for rearranging goods based on delivery plans
• Traditional small stores, supermarkets, hypermarkets, discount stores, consumers' co-operatives, and groups with collective buying power. Subsidiaries and franchisers also sell goods under different brands.

Logistic families and metrics

A logistic family groups products that share similar features like weight, storage needs, handling, and ordering. Companies use different measures to organize products, such as how much space they take up, how often they are ordered, and how much they cost to store and move. One common measure is inventory turnover.

Handling and order processing

Unit loads are groups of items moved together, often on pallets. Handling systems include special machines like pallet handlers and automated vehicles. Storage systems include racks and shelves.

Order processing involves several steps: making a list of what to pick, picking items, sorting them by where they need to go, packing them, and getting everything ready for shipping. Picking can be done by people or machines, and sorting can also be manual or automatic.

Transportation

Main article: Cargo

Combining small shipments into larger ones can save money. There are three ways to do this: bringing shipments closer together, stopping multiple times to collect goods, and adjusting shipping times. Cargo can be put on pallets or in containers. The five main ways to move cargo are by ship, rail, truck, air, or pipeline, and these can be mixed in different ways. Shippers pick the best method based on cost and time. Air is the most expensive, followed by truck, rail, pipeline, and ship.

Cargo can be organized in different ways and moved in standard units like ISO containers, swap bodies, or semi-trailers. For long distances, different transport methods might be used. When moving cargo, the weight and volume matter.

People and companies involved in transportation include train and truck companies, boats, airplanes, couriers, freight forwarders, and multi-modal transport operators.

International shipments usually follow Incoterms rules set by the International Chamber of Commerce.

Configuration and management

In logistics, a system is set up to keep costs low while meeting customer needs. As service gets better, more sales happen. Logistics systems need good planning, similar to production systems. Methods from operations management, like economic order quantity models, help manage inventory.

Distribution resource planning (DRP) is like MRP but focuses on planning how goods move through the network, not just inside one place.

Setting up a logistics system can happen at a warehouse or for the whole network. For a single warehouse, decisions include how to arrange space, what tools to use, and how to store goods. For the whole network, decisions include where to place warehouses and how much space each should have. Sometimes, companies work with other businesses to share resources.

When a logistics system is set up, managing it involves making decisions about how to store and move goods, considering limits like space and time.

At a warehouse, decisions include how to arrange goods, and how workers pick them. For the whole network, decisions include managing inventory and choosing the best paths for delivery. Logisticians also handle returns along with new shipments.

Warehouse management system and control

Warehouse management systems (WMS) and warehouse control systems (WCS) help manage warehouses but work differently. A WMS plans activities based on past data, while a WCS makes real-time decisions to keep things moving smoothly. Together, they help warehouses work efficiently.

Logistics outsourcing

Logistics outsourcing is when a company works with another that provides logistics services. This partner offers more specialized services and works together for the long term. Outsourcing can be full or partial, such as using one service for a specific need, creating a new company, or joining forces with another.

Third-party logistics (3PL) means using outside companies to handle logistics tasks that a business used to do itself. These providers have grown from just offering basic help to managing whole supply chains, giving companies a competitive edge.

The idea of a fourth-party logistics (4PL) provider was first described by Andersen Consulting (now Accenture). A 4PL manages the entire supply chain process, bringing together resources from different groups to create full solutions. Unlike a 3PL, which focuses on one task, a 4PL handles the whole process.

Horizontal alliances between logistics service providers

Horizontal business alliances happen when logistics companies work together even though they might compete. These partnerships help companies share resources like transportation networks and warehouses, and also share knowledge and ideas for new services.

Logistics automation

Logistics automation uses computer software or machines to make logistics work better. This often happens in warehouses or places where things are sent out. Bigger tasks are handled by supply chain engineering and enterprise resource planning systems.

Machines can find products using barcodes or RFID tags. Barcodes have black and white lines that a machine reads to get information. RFID tags are small cards with chips that send signals to readers. RFID tags can be on products, animals, cars, or even people.

Professions and organizations

A logistician is a person who works with moving goods and services from where they are made to where they are needed. Logisticians can work for special companies that move things, like shipping lines or airports, or they can work inside bigger companies that need help managing their supplies. The work of a logistician can include many different jobs, like buying, making, selling, and getting rid of products.

Some universities teach people to become logisticians. One special university is Kühne Logistics University in Hamburg, Germany, which focuses just on logistics.

There are groups that help logisticians learn and grow in their jobs. For example, the Chartered Institute of Logistics and Transport in the United Kingdom offers training and qualifications for people working in logistics. There are also groups like the Global Institute of Logistics in New York, which thinks about big questions in moving goods around the world, especially by ship.

There are also museums that show how logistics works, with some focusing on moving things for the military.