8 Main Activities Of Logistics

1. Order Processing

Order Processing or Execution of customer orders is an important step, it represents several activities included in the order cycle, namely order preparation, transmission, receipt and dispatch of the order and status reporting. Doing it faster means spending less and being more productive. This is a philosophy adopted in order processing as well. The more efficient and without the need for rework, the better. Contemplating a large portion of logistical costs, it is one of the main areas in the logistics activity, as it makes the product go through its stages and that these stages are successfully completed without any problem so that the company can satisfy the customer desire.

Good order processing management excellence is essential in a supply chain to ensure the high level of service desired by customers.

2. Forecasting customer demand

Forecasting customer demand (Demand Forecasting) is a forecast of demand for products in the future. Anticipating customer needs in advance, allows the company to determine the quantity of products to be produced and what and how much resources will be required. Wrong estimation or forecasting can lead to high costs and operating losses for the company and will result in stock out of products for customers or overstocking at the warehouse.

3. Customer Service

Customer Service is an activity where organizations try to meet the needs of customers. How well this will do depends on the efficiency of other logistics activities, especially the delivery of goods on time and in full quantity. Ensuring on-time delivery is everything. You need to be in control from the first moment an order is placed and mobilize efforts to ensure its fast and safe delivery

4. Inventory Management

Inventory Management is an important activity. Despite being considered a “shop floor” area, the routines directly affect the results of purchases and sales — helping to balance demand and purchase of new items, compared to what is still available in stock. For this, some more complex analyzes are performed, such as the demand forecast survey and the ABC curve analysis. It is in this sector that the company’s cost and performance information is processed to carry out daily transactions. The raising of costs is crucial for all business activities, given that, when it is very high, it impacts the profitability of the business. Furthermore, in times when markets are increasingly competitive and customers are more demanding, having the appropriate and relevant information can be the key factor to achieve a competitive edge.

5. Warehouse management

Warehousing and Storage is an activity related to warehouse management such as storage of goods., warehouse space management, management of various equipment and appliances necessary to carry out activities in the warehouse. Storage determines the best use of the space needed to maintain and conserve stock. This definition goes through studies that cover the location, the dimensions of the space and even the possibility of acclimatizing the place. Among the decisions involving this area are choosing the best place to implement the DC (according to exit routes, proximity to customers, taxation, among other variables) and renting warehouses. Choosing the location of the factory and warehouse must pay attention to the proximity to the source of raw materials and customers for ease of access and related to transportation distance including the ability to meet the needs of customers.

6. Material Handling

The transformation of materials takes place during the movement of materials or during the pause between two movements. it examines the production phases from the raw material to the finished product. Material handling is a sub-area of logistics that includes the storage, packaging and movement of goods of all kinds. Within a company, we speak of the internal material movement. This material movement can be implemented, for example, with the help of forklifts, lift trucks, storage and retrieval machines or conveyor systems. Roughly speaking, the material flow represents the logistics chain from the supplier to the customer, which can be optimized effectively and sustainably on the basis of regular material flow analyzes. These reports record the processes, storage and transport processes in order to uncover weak points in the material flow. The aim is to design material handling in such a way that costs are saved, lead times are shortened and waste is avoided.

7. Transportation

Transportation activities cover all activities that involve most efficient movement of goods from the point of origin to the point of consumption. The correct quantity must be delivered in perfect condition. It is the area that accounts for one to two thirds of logistics costs. Without transport, nothing can be done, as ensuring its proper functioning ensures the production, distribution and marketing of products. A good professional can also assess and improve the logistics chain and transport options, to reduce costs and increase the competitiveness of companies. It is in this area that the best carrier is defined – according to the type of item, term or cost -, route planning, payment scheduling for carriers and management of transport incidents. This includes Reverse Logistics which is the process of handling returned goods. when the product is damaged or wrong product delivered.

8. Packaging

This is the area responsible for the conservation of transported products, ensuring the delivery of these goods to their destination without any kind of damage, which always causes losses and headaches. In these cases, when negotiating with suppliers, the ideal is also to value the quality and not only the cost of packaging. It is also worth remembering that it is necessary to carry out a study regarding the most appropriate boxes according to the product’s characteristics and other additional safety items — such as bubble wrap. This care helps to prevent packages that are too tight to suffer damage (which could cause damage to the goods), or that the item suffers damage due to being transported in a larger package, causing friction.

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In today’s article, we only gave you the main areas in which logistics work. As can be seen, for those who want to start a career in the sector, the options are quite varied, covering the most diverse profiles. Now that you know better, do you know which one to choose?

8 Main Activities Of Logistics