The 7 Functions of Logistics Management

functions of logistics

Table of Contents

What is Logistics?

Logistics refers to the process of managing and monitoring the complex supply chain operations about how the resources are acquired, stored, and transported to the desired destination. There are various functions of logistics management that are extremely essential for the seamless movement of goods or products. In the contemporary world, managing the logistics operations powered by modern technologies such as Artificial Intelligence(AI), Internet of Things(IoT), Big Data, and so on can take your business to the next leap. Logistics processes play a vital role in delivering the right product or goods to the end customers at the right time.

 

Major Functions of Logistics Management

 

Understanding the objectives of logistics management can help organizations to boost profitability and enhance the customer experience. Therefore, implementing and executing efficient logistics functions allow companies to gain a substantial competitive advantage.

 

1. Order Processing

Logistics operations tend to begin with order processing as it manages the entire workflow that determines the orders are prepared and delivered to the customers. It is a vital part of fulfilling the customer requirements, so it consists of major activities such as picking, packaging, and delivering the goods.

 

Following an effective logistics strategy allows the organizations to receive, record, assemble and distribute customer orders in the shortest period. It is imperative for business owners as it is considered to be the key component of order fulfillment. There are five major steps in order processing such as order placement, picking inventory, sorting, packing, and shipping. Therefore, optimizing these activities are making the operations efficient and accurate.

 

2. Material Handling

Logistics companies are responsible for managing the surplus goods within the warehouses. It ensures that the goods are safely transported throughout the entire process starting from manufacturing to distribution. Handling goods or materials can be a daunting task, therefore the organizations should streamline the work activities and incorporate the relevant equipment which is manual, semi-automated, and automated equipment. Moving stored materials or products is an important function of logistics which can lower the manufacturing cost and elevate the customer experience.

 

3. Inventory Management

It manages the crucial information about the flow and storage of goods by determining how much stock is needed. It uses various valuable insights to keep the track of the goods and maintain sufficient inventories. Inventory management in logistics helps in restocking and predicting the demand in the supply chain operations.

 

Moreover, it determines the speed of production processes which is an efficient way to make the decisions cost-effective. Nowadays, the just-in-time inventory is also becoming popular as it increases efficiency by accurately forecasting demand and meeting the customer requirements without investing much in manufacturing.

 

4. Warehouse Management

It is the major function in logistics management as it is essential in running day-to-day operations in the warehouse and safeguarding the goods.It is advisable that the warehouses should be nearby to the dealer or the distributors’ place can be beneficial to maintaining timely delivery.

 

Moreover, storing the goods or products is critical to business growth. Thus, it has become imperative to choose the right warehouse by analyzing the structure, layout, dimensions, etc. Warehousing plays an important role in the supply chain so it is advisable to manage and optimize the operations in the warehouses with real-time data for the efficient functioning of the workflow.

 

5. Transportation

It is required throughout a company’s supply chain to run the operations efficiently which is also useful in driving high levels of operational excellence. Companies are focusing on keeping transportation costs under control with advanced routing practices and following compliance and regulations.

 

Embracing a transportation network that responds to your organizational needs is significantly optimizing the last-mile delivery and reducing transportation costs. Therefore, it is known to be one of the major functions of logistics as it is driven by strategic planning and determines the success of the supply chain ecosystem.

 

6. Packaging and Labelling

It is an important aspect of the supply chain as the packaging of the product or goods plays a vital role in facilitating sales. Encasing a product into suitable packages and containers with safety and customs regulations is extremely essential to enhance logistics functions. Packaging should be done correctly to eliminate the breakage or spillage of the goods.

 

It also involves labeling which provides essential information about the goods such as date of manufacturing and expiry, price ingredients, and so on. It is a critical element that is used for damage prevention and enhancing material handling. proactive about this area of your business.

 

7. Information and Control

The element of information and control allows the businesses to gain clear visibility of the supply chain operations. It can help organizations to get real-time insightful data with new-age technologies. Analyzing those data is useful in evaluating overall delivery effectiveness. Therefore, embracing the latest technological innovations strengthens the business goals by significantly impacting the decisions and making the operations more cost-effective.

 

In order to effectively manage fleets, the most important function of logistics is to implement transparency in the entire supply chain process. Having a deep knowledge will enable businesses to create strategies that are for meeting consumer demands.

 

Conclusion

These are some of the major functions of logistics management that help organizations to manage entire supply chain operations. Making last mile delivery more accurate, efficient, and customer-centric. Following the logistics operations and the fundamental process is the best way to avoid potential disruptions and business growth.

 

Proper logistics management ensures the managing and monitoring of the fleets in real-time to make data-driven decisions and enhance the overall supply chain strategy.