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LOG i STICS
A glimpse…
Logistics originated in the military's need to supply themselves with arms, ammunition and rations as they moved from their base to a forward position. In ancient Greek, Roman and Byzantine empires, there were military officers with the title ‘Logistikas’ who were responsible for financial and supply distribution matters.The term "logistics" originates from the ancient Greek "λόγος" ("logos"—"ratio, word, calculation, reason, speech, oration").
Supply Chain Management
•suppliers ( and their suppliers), •consumers (and their consumers), •manufacturing centers, warehouses,• distribution centers, •and the retail outlets, •as well as raw materials, work-in-process inventory, and finished products that flow between facilities
Four Pillars• Procurement• Demand and Replenishment • Customer Service• Logistics
Logistics
is the process of Planning, Implementing and Controlling the efficient, cost-effective flow and storage of raw materials, in-process inventory, finished goods and related information from point of origin to point of consumption for the purpose of conforming to Customer Requirements
“Ensuring availability of the right product in the right quantity, and of right condition at the
right place, at the right time, for the right customer, at the right
cost”- Council of Logistics Management
Main Objective
Consumers
Manufacturing
Supplier
Supplier
Warehouse
RetailersDistributors
A Typical Supply Chain
Client
Vendor A
Vendor C
Vendor D
- Receiving- Quality Assurance- Storage- Production- Picking/Packing
Customer A
Customer B
Customer C
Forwarders/Brokers/Truckers
Forwarders/Brokers/Truckers
Current Logistics Practice
• Warehousing• Materials Handling• Inventory Management• Transportation and Distribution
Logistical Operations
A warehouse is a place for storage or any space or area that is used to keep materials, goods,
products, and other items for a period of time until finally withdrawn, used, transferred or sold.
It is also described as a place where things kept are protected from elements and safe guarded from
losses
What is a Warehouse?
•To receive materials and supplies in accordance with proper documentation procedures and in conformance with specified quality.•To plan and provide adequate storage space for goods•To keep storage of goods in accordance with efficient warehousing practices including ease of order picking•To undertake measures to protect stocks from damage, pilferage, and unauthorized movements•To implement a system of reconciling inventory records with actual physical stock•To issue and transfer materials and goods in conformance with set documentation procedures•To assist in the effective and efficient disposal of scrap/surplus items by identifying, collecting, and segregating these items for easier disposal.
Major Objectives of Warehousing
• Warehousing• Materials Handling• Inventory Management• Transportation and Distribution
Logistical Operations
What is Materials Handling?
From an engineering point of view, it is the art and science involving the moving, packaging, and storing of substances in any form.
From the logistics management point of view, it is the portion of the business system which affects the relationship of material and packaging to the product, facility, or customer without adding usable worth or changing the nature of the product.
• Motion• Time• Place• Quantity• Space
Elements of Materials Handling
Objectives of Materials Handling
Reduced Cost-Lower Inventory and production control
costs-Better space utilization/ reduce demurrage-Shorter production time cycle
Reduce Waste-Less Spoilage-Less damage by improper handling
Increased Productivity Capacity-Assure constant rate of production-Coordinated handling system-Better control of materials-More effective use of manpower-Eliminates production bottlenecks
Improved Working Conditions-Safer working situations-Less fatigue-Upgrading employee to more productive work
Improved Distribution-Quicker delivery to customers-Increased production volume due to lower cost-Cut damage claims.
3Ms of Materials Handling
What
When
Where
Who
How
Material
Movement
Method
Physical Characteristics
Volume
Source & Destination
Scope
Route
Frequency
Speed or Rate
Unit Handled
Equipment
Manpower
• Warehousing• Materials Handling• Inventory Management• Transportation and Distribution
Logistical Operations
Inventory ManagementInventory Management determines the amount of inventory to keep in stock that is how much to order and when to replenish, or order.
Role of Inventory Management in Logistics
•management of inventories to have the right amount and to achieve competitive priorities for the business.
•balance the conflicting cost in keeping inventory to ensure supply versus stock-out issue that affects revenue and customer service.
• Warehousing• Materials Handling• Inventory Management• Transportation and Distribution
Logistical Operations
Transportation and Delivery
it provides service operation which moves materials and goods between each process in the link and between links in the supply chain to obtain cost efficient transport route from supplier to factory and factory to customer.
supplier storage plant warehouse customers
RM SupplyPoint RM Storage Manufacturing FG Storage Markets
Movement/transport
Movement/transport
Movement/transport
Movement/transport
Movement/ Transportation Sytem
Distributionis the coordination and management of the movement, inventory, protection and storage of finished goods from the end of production line to the customers to achieve timely and cost effective service level. It aims to minimize cost involved in physically moving and storing products from its production point to the point where it is purchased by customer, while maintaining customer service level
Manufacturingplant
Raw materialssupply point
Raw materialssupply point
MarketCustomer
MarketCustomer
MarketCustomer
Simple Distribution System
ManufacturingPlant
ManufacturingPlant
ManufacturingPlant
Raw MaterialsSupply point
Raw MaterialsSupply point
Raw MaterialsSupply point
Raw MaterialsSupply point
warehouse
warehouse
warehouse
warehouse
wholesaler
wholesaler
wholesaler
wholesaler
retailer
retailer
retailer
retailer
retailer
retailer
retailer
retailer
retailer
retailer
retailer
retailer
retailer
retailer
retailer
retailer
retailer
retailer
retailer
retailer
Complex Distribution System
QuizQuiz• Define supply chain (3points)Define supply chain (3points)• 4 pillars of supply chain4 pillars of supply chain• 7 Rs7 Rs• 3M’S of Material Handling3M’S of Material Handling• 5 elements of Material Handling5 elements of Material Handling• 3 types of material inventory3 types of material inventory