Logistics - Term Overview

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Logistics is the set of means and methods that allow to carry out the organization of a company or a service. The logistics business involves a certain order in processes involving the production and marketing of goods.

It's said, therefore, that logistics is the bridge or the nexus between production and the market. Physical distance and time separate the productive activity from the point of sale: logistics is responsible for uniting production and market through its techniques.

In companies, logistics involves planning and resource management tasks. Its function is to efficiently implement and control materials and products, from the point of origin to consumption, with the intention of meeting consumer needs at the lowest possible cost.

The origin of logistics is in the military sphere, where the organization tended to attend to the movement and maintenance of troops in the field. In times of war, efficiency in storing and transporting items is vital. Otherwise, soldiers may suffer from a shortage of means to face the harshness of the fighting.

Based on these experiences, business logistics was in charge of studying how to place goods and services in the right place, at the right time and under the right conditions. This allows companies to meet the requirements of their customers and obtain the highest possible profitability.

Logistics specialists rely on various tricks that help them achieve the best possible results, and there are companies that are dedicated to advising others in this particular aspect. If we take a warehouse as a reference, we can study some of the most common tips to improve logistics. First is the choice of strategy, which must be tailored to specific needs: an ideal one for an order volume of less than one hundred can be detrimental if this number exceeds one thousand, for example.

Taking the volume of orders as a parameter, we enter a logistics classification in which we can recognize the following types:

  • Small: around fifty orders a day, for which a 500 square meter warehouse and five employees are enough;
  • Structured: the number of orders per day exceeds fifty. The number of employees and their specialization must be greater, so that the rigor of their work increases;
  • Industrialized: a minimum of a thousand orders a day, a volume that requires automation through computer programs.

One of the most common practices in today's market is outsourcing to third parties to perform certain specific tasks. Well, logistics also includes this strategy. While its cost is higher than that of an internal organization, it's more practical because the main company doesn't have to make any changes to its workforce, such as expansion or training.

On the difficult path of optimizing logistics, the quality of the work environment stands out. This aspect must be taken care of to the maximum so that the distribution of the products is optimal. Among the most frequent tips is to limit unnecessary movement and the transport of heavy loads, relying on a good organization of the shelves and the use of machines that avoid the most risky physical efforts for employees.

Without a doubt, order is another of the pillars of good logistics. In this context, it's ideal to number the products, design routes to reach each one of them and clearly delimit the work and storage areas.

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