Functions of logistics and their impoartance.

operations included in logistics and why it is important!

1. Jay V. pardasani Ty div.: 2 Roll no.: 103 Logistics management Functions O f Logistics A nd T heir I mportance

2. About Logistics: Planning, implementing and controlling the physical flows of the materials and finished goods from the point of origin to point of use to meet the customer’s need at a profit. Logistics management is an integrative process which optimizes the flow of materials and supplies through an organization to the customer.

3. Functions: The major functions of logistics management are: Order Processing Inventory Control Warehousing Transportation Material Handling and Storage System Logistical Packaging

4. Order Processing Purchase order by buyer to supplier Legal document It includes descriptive and technical details relating product supply, price, delivery period, payment terms, taxes and other commercial terms as agreed Importance : performance cycle time, order processing, scheduling production and material. Ackn0wledging order deviations (if any)

5. Inventory Control It tries to maintain, SUPPLY = DEMAND Minimum cost as possible Inventory cost includes financing, insurance, storage, losses, damages These cost are 10-15% of the total annual inventory

6. Warehousing Storing of finished goods until they are sold The effectiveness of an organizations marketing depends on the appropriate decision on warehousing Major decisions are location, number of warehouses, size, layout, design of the building, ownership.

7. Transportation Vital to complete the transaction It has 65-70% share of the total logistics cost Modes of transportation is selected on the basis of the infrastructure, region, cost, urgency, product-market conditions and customer requirement

8. Material Handling and Storage System Material handling should be opted accordingly, or it will lead to product damages, delay in delivery and incidental overheads. Mechanization and automation in the material handling enhance the logistics system productivity The storage system is vital for maximum space utilization

9. Logistical Packaging Difference: logistical packaging and product packaging. LP is influenced by physical distribution of the product. The utilization of load has the major bearing on logistical packaging with regard to the packaging cost.

10. Thank You!