What is Role of Logistics in Supply Chain Management?

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what is role of logistics in supply chain
management?
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What is Supply chain Management?

• Supply Chain Management is the active management
  of supply chain activities to maximize customer
  value and achieve a sustainable competitive
  advantages. A supply chain transforms raw
  materials and components into a finished product
  thats delivered to a customer. It is made up of
  a complex network of organizations and
  activities, such as raw materials suppliers,
  manufacturers, distributors, retailers and the
  customer.
• The concept of Supply Chain Management (SCM) is
  based on two core ideas
• The first is that practically every product that
  reaches an end user represents the cumulative
  effort of multiple organizations. These
  organizations are referred to collectively as the
  supply chain.
• The second idea is that while supply chains have
  existed for a long time, most organizations have
  only paid attention to what was happening within
  their four walls. Few businesses understood,
  much less managed, the entire chain of activities
  that ultimately delivered products to the final
  customer. The result was disjointed and often
  ineffective supply chains.

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What is Logistics?

• Logistics is most important to all the industries
  who deal in products. It is specially relevant in
  the world of supply chain management. Logistics
  refers to the process and coordination of
  products, raw materials and services across the
  supply chain. From manufacturing and production
  to distribution, fulfillment, and final delivery
  to customers and end users, logistics is a
  critical and essential component of a successful
  supply chain.
• Below are the logistics components
• Inbound transportation
• Outbound transportation
• Fleet management
• Warehousing
• Materials handling
• Order fulfillment
• Inventory management
• Demand planning

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Functions of Logistics within Supply Chain
Management

• Warehouse design and management - This role of
  logistics in supply chain management covers
  several tasks at once from the design of storage
  facilities to the requirements for storage of
  products and ending with the introduction of
  various automation solutions.
• The formation of packages - Packaging, tracking
  and accounting all of these tasks allow for
  end-to-end control of goods on the way to the
  customer/distributor.
• Transportation of products - This includes work
  with cargo carriers and vehicles listed in the
  companys fleet planning their routes,
  calculating fuel costs, etc.
• Working with customs - When an enterprise plans
  international delivery of goods, it is very
  important that during their transportation the
  goods fully comply with customs requirements and
  contain all the necessary documentation.

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Continue..

• Working with intermediaries - Intermediaries in
  logistics are all third-party, non-company
  resources that are directly involved in the
  implementation of supply chains. In turn, finding
  intermediaries with the most acceptable ratio of
  quality to cost of services, as well as
  establishing long-term, reliable relations with
  them are also included in the list of tasks
  for efficient logistics management.
• Working with written off and returned goods -
  There is also such a thing as reverse
  logistics, which establishes the rules and
  routes for transporting the returned/discarded
  goods, as well as ways to dispose of them.

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Challenges Logistics in Supply Chain

• Minimization of enterprise expenses
• Consolidation of traffic volumes
• Improving the quality of service
• Reduction of actual losses and reduction of
  possible risks
• Minimization of the need for intermediary
  services
• Supporting goods with the necessary documentation
• Timely response to changing market demands

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Values Logistics in Supply Chain

• ensuring the smooth operation of all parts of the
  supply chain
• release of labor resources
• coverage of a new target audience
• net cost reduction

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