Logistics and International Logistics Meaning, Definition, international logistics management

Introduction

We human beings have many needs, and to fulfill those needs, various products are manufactured. The manufacturer makes these products and delivers them to the consumer, ensuring their demands are met effectively. Let’s explore the intricate process of logistics and its extension into international logistics.

Understanding Logistics

Logistics involves the transportation of goods, i.e., the physical movement of goods from one place to another. The concept is well illustrated by Domino's Pizza, known for its promise to deliver pizzas within 30 minutes. This involves meticulous planning, calculating the time required for order processing, pizza making, packing, and delivery. Logistics encompasses the complete setup to ensure swift delivery.

Definition and Scope of Logistics

Logistics is about managing the physical flow of goods from their point of origin to the point of consumption. Leading experts such as Philip Kotler define logistics as planning, implementing, and controlling the physical flow of materials from the source to the consumer, fulfilling customer needs while generating profit.

Similarly, the American Council of Logistics Management defines logistics as the efficient and effective flow and storage of goods, services, and related information from the origin to the consumption point, aligning with customer requirements.

Importance of Logistics

Logistics is critical in ensuring that products reach consumers at the right place, time, price, and condition. It involves multiple activities such as transportation, inventory management, order processing, and demand forecasting.

Domestic vs. International Logistics

Logistics can be categorized as domestic or international:

Domestic Logistics

Domestic logistics refers to the transportation of goods within a country's borders, from one district to another.

International Logistics

International logistics involves the physical movement of goods and services across international borders. The term logistics gained prominence during World War II when countries transported essential materials and equipment to soldiers on the battlefield.

Export and Import

Export: When a country sends products to another country through airways or ships, it involves international logistics.
Import: When a country imports goods from another, the logistics activities performed are considered international logistics.

Objective of Logistics

The primary objective is to maintain the flow of goods and services from the seller to the customer, ensuring accurate delivery in terms of quantity, assortment, condition, and at the right price.

Activities Involved in Logistics

Demand Forecasting: Estimating customer demand to maintain adequate inventory.
Distribution Channel Maintenance: Ensuring relationships with retailers and wholesalers are well managed to facilitate smooth delivery.
Order Processing: Handling customer orders efficiently, from order placement to delivery.
Inventory Management: Maintaining sufficient stock to meet customer demand.
Warehousing: Storing goods at appropriate locations to ensure timely distribution.
Packing: Ensuring products are packed properly for safe transportation.
Transportation Regulation: Managing traffic and transportation logistics.
Reverse Logistics: Handling returns effectively.
Customer Service Maintenance: Offering support and services to fulfill customer needs and handle post-delivery issues.

Summary

Logistics refers to the comprehensive process of planning, implementing, and controlling the flow of goods from the point of origin to consumption, ensuring customer satisfaction and profitability for businesses. International logistics extends these activities across borders, involving export and import processes to meet global demand.

Keywords

Logistics
International Logistics
Transportation
Supply Chain Management
Demand Forecasting
Inventory Management
Order Processing
Export
Import

FAQ

What is the definition of logistics?

Logistics is the process of planning, implementing, and controlling the efficient flow and storage of goods from the point of origin to the point of consumption to meet customer requirements.

What is the difference between domestic and international logistics?

Domestic logistics involves the transportation of goods within a country's borders, whereas international logistics involves the movement of goods across international borders.

What activities are involved in logistics?

Key activities include demand forecasting, distribution channel maintenance, order processing, inventory management, warehousing, packing, transportation regulation, reverse logistics, and customer service maintenance.

What is the objective of logistics?

The objective is to ensure the right product reaches the customer at the right place, time, price, and condition.

How did the term 'logistics' gain prominence?

The term logistics gained prominence during World War II when countries transported essential materials and equipment to soldiers on the battlefield, illustrating the strategic importance of timely and effective supply management.