What Is Logistics Management, and Why Is It Important?July 21, 2021
Logistics has been an incredibly important component of military and trade operations for centuries. Originally coined as a term referring to the transportation of equipment and supplies to troops, logistics now applies to modern Ecommerce businesses around the world.
Let’s find out what Logistics Management is and why it plays a vital role in many business organizations.
The Definition of Logistics Management
Logistics Management is the process of meeting customers’ delivery demands using effective movement and storage of goods and services from origin to destination.
Logistics Management involves many elements, including:
- Choosing appropriate vendors with the ability to provide transportation
- Selecting the most effective transportation routes
- Using software and information technology (IT) to handle related logistical processes
Now that we have a good understanding of logistics management, here are several reasons why it’s important, especially for Ecommerce businesses.
Why Logistics Management Is Important
Logistics Management aims to ensure that current and future profitability are optimal through cost-effective order fulfillment. It even helps to improve the customer experience by focusing on timely deliveries.
Logistics Management also gives organizations data on movements in real-time and helps them implement changes that can help businesses avoid problems. Problems that good Logistics Management could prevent include:
- Failed or delayed deliveries that lead to buyer dissatisfaction
- Damage of goods due to sluggish transportation
The Difference Between Supply Chain and Logistics Management
Supply chain Management and Logistics Management are often confused with one another. A supply chain refers to a large network of organizations working together to deliver products from the supplier to the customer. Logistics Management on the other hand is just one part of the supply chain, working to coordinate and move resources.
Who Handles Logistics Management?
Who handles Logistics Management changes depending on the company, but typically a logistics specialist is called a logistician. They are responsible for analyzing and coordinating an organization’s supply chain and oversee the entire life cycle of a product from acquisition to delivery.
However, having one logistics specialist is not enough. It takes the right technology, equipment, and skilled personnel to ensure logistics are handled efficiently.
3PLs Can Help With Logistics Management
If Logistics Management sounds like an overwhelming task, it’s important to know there are effective outsourcing solutions. Third party logistics providers like Fulfillment Works can help improve the efficiency of your logistics by optimizing your inventory levels, minimizing time in transit, scheduling shipments, and more.