Logistics

 

the management management  of the flow of  resources resources  between the point of origin and the point of Logistics is the  consumption in order to meet some requirements, for example, of customers or corporations. The resources managed in logistics can include physical items, such as foo food, d, materials, equipment, liquids, and staff, as well as abstract items, such as time, information, particles, and energy. The logistics of physical items usually involves the integration of information flow,  flow, material handling, handling,  production production,, packaging, packaging, inventory, inventory, transportation transportation,, warehousing warehousing,, and often  often security. security.  The overall management of the way resources are obtained, stored and moved to tthe he locations where they are required. Logistics management entails identifying potential suppliers and distributors; evaluating how accessible and effective eff ective they are and establishing relationships and signing contracts with the companies who offer the best combination of price and service. A company might also choose to handle its own logistics if it is cost-effective cost -effective to do so. Objectives of Logistics Management  

To make available the right quantity of right quality products at the right place and time in right condition. To offer best service to consumers. To reduce the cost of operations. To maintain transparency in operations. International Logistic System

This is a very important part of an international company because of geographical barriers. Logistics of an international company includes movement of raw materials, coordinating flows into and out of different countries, choices of transportation, cost of the transportation, packaging the product for shipment, storing the product, and managing the entire process. The concept of logistics is fairly new in the business world. The theoretical development was not used until 1966. Since then, many business practices have evolved and logistics currently costs between 10 and 25 percent of the total cost of an international purchase. There are two main phases that are important in the movement of materials: material management and physical distribution. Materials management is the timely movement of raw materials, parts, and supplies. The physical distribution is the movement of the firm's ffinished inished products to the customers. Both phases involve every stage of the process including storage. The ultimate goal of logistics is to coordinate all efforts of the company to maintain a cost effective flow of goods. There are four logistics concepts: the systems concept, the total cost concept, the after-tax concept, and the trade-off concept. The systems concept is based on all functions of a organization working together in order to maximize m aximize benefits. This concept sometimes requires certain components of the organization to operate suboptimally in order to achieve maximum goals of the system. The total cost concept is based on the systems concept, however goal achievement is measured in terms of cost. A variation of the total cost concept is the after-tax concept.

 

International transportation issue

But there are also risks for road transport:          

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long distances overland can take more time there can be traffic delays and breakdowns there is the risk of goods being damaged, especially over long distances toll charges are high in some countries some countries have different road and traffic regulations

Other sea advantages include:  

you can ship large volumes at low costs - a freight forwarder can consolidate consignments to reduce costs   shipping containers can also be used for further transportation by road or rail

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However, there are also risks for sea transport:  

shipping by sea can be slower than other transport modes and bad weather can add further delays   routes and timetables are usually inflexible

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difficult    tracking your goods’ progress is difficult    you have to pay port duties and taxes   further transportation overland will be needed to reach the final destination    basic freight rates are subject to fuel and currency surcharges

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rail advantages:    

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fast rail links throughout Europe it is environmentally friendly compared with other transport modes

However, there are also risks for rail transport:        

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routes and timetables available can be inflexible, especially in remote regions rail transport can be more expensive than road transport mechanical failure or industrial action can disrupt services further transportation may be needed from a rail depot to t o the final destination, adding to costs and affecting delivery schedules

Warehousing

A warehouse is a  a commercial building  building for storage of  goods. goods. Warehouses are used by  by manufacturers manufacturers,,  importers,, exporters exporters,, wholesalers wholesalers,, transport transport  businesses,  businesses, customs customs,, etc. They are usually large plain importers buildings in industrial areas of cities and towns and villages. They usually have  have loading docks  docks to load and unload goods from trucks. Sometimes warehouses are designed for the loading and unloading of railways,, airports airports,, or   or seaports seaports.. They often have  have cranes  cranes and and  forklifts  forklifts for moving goods directly from  from railways goods, which are usually placed on  on ISO ISO  standard standard  pallets  pallets loaded into into  pallet racks. racks. Stored goods can include any raw materials, packing materials, spare parts, components, or finished goods associated with agriculture, manufacturing and production.

 

The advantages and disadvantage disadvantagess of air transport. 

Air transport is of recent origin in the development of transport system of a country. It is the gift of 20th century to the world. The second world ware has stimulated the growth of air transport and it has made progress in the recent years because it is the fastest way of transporting of goods. The transport of goods through airways is costly and therefore it is designated to carry costly goods of small quantity. When goods or passengers are carried by air, certain documents are issued because the carriage of Air Act, 1972 has made it obligatory. The documents issued when goods or passengers are carried are: 1.  Passenger Ticket 2.  Luggage Ticket 3.  Air Consignment Note. In India two nationalized airways operate which help in the conduct of air transport. These airways are the Indian Air Lines and the Air India International. The former is concerned for domestic operation whereas the later is concerned for international operation. Advantages  

The following are some of the advantages of air transport: t ransport: I. High Speed: 

Air transport is the fastest mode of transport and therefore suitable carriage of goods over a long distance requiring less time. There is no substitute for air transport when the transport of goods is required urgently. II. Quick Service: 

Air transport provides comfortable, efficient and quick transport service. It is regarded as best mode of transport for transporting perishable goods. III. No Infrastructure Investment:  

Air transport does not give emphasis on construction of tracks like railways. As no capital investment in surface track is needed, it is a less costly mode of transport. IV. Easy Access: 

Air transport is regarded as the only means of transport in those areas which are not easily accessible to other modes of transport. It is therefore accessible to all areas regardless the obstruction of land. V. No Physical Barrier: 

Air transport is free from physical barriers because it follows the shortest and direct routes where seas, mountains and forests do not obstruct. VI. Natural Route: 

 

Aircrafts travels to any place without any natural obstacles or barriers. Because the custom formalities are compiled very quickly. It avoids delay in obtaining clearance. VII. National Defence: 

It plays a significant role in the national defense of the country because modern wars are conducted with the help of aero planes. Airways has a upper hand a destroying dest roying the enemy in a short period. Disadvantages 

Inspite of many advantages air transport has a number of disadvantages. These disadvantages are: I. Risky: 

Air transport is the most risky form of transport because a minor accident may put a substantial loss to the goods, passengers and the crew. The chances of accidents are greater in comparison to other modes of transport. II. Very Costly: 

Air transport is regarded as the costliest mode of transport. The operating cost of aero-planes are higher and it involves a great deal of expenditure on the construction of aerodromes and aircraft. Because of this reason the fare of air transport are so high that it becomes beyond the reach the common people. III. Small Carrying Capacity: 

The aircrafts have small carrying capacity and therefore these are not suitable for carrying  bulky and cheaper goods. goods. the load capacity cannot be increased as it is found in case of rails. IV. Unreliable: 

Most of the air transport are uncertain and the unreliable because these are controlled by weather condition. It is seriously affected by adverse weather conditions. Fog, snow and heavy rain weather may cause cancellation of some flights. V. Huge Investment: Investment: 

Air transport requires huge investment for construction and maintenance of aerodromes. It also requires trained, experienced and skilled personnel which involves a substantial investment.

 

Sea Freight 

Sea transportation is usually used by companies who ship a large amount of goods at once, with longer lead times. This mode of transport is the longest, yet is ideal for bulk shipments such as coal and minerals. Advantages o Ideal for transporting heavy and bulky goods o Suitable for products with long lead times o Cheap for large volumes Disadvantages o Very slow, longer lead/delivery times o Difficult to monitor exact location of goods in transit o Customs and Excise restrictions o Could be costly o Inflexible routes and timetables o Port duty/taxes o Requires inland transportation for door-to-door delivery