Logistics and supply chain Flashcards
What is a supply chain
A supply chain is the entire process of making and delivering a product, from sourcing raw materials to manufacturing, transportation, and finally, distribution to customers.
Define logistics
Refers to activities within one company or organisations involving product distribution
Logistics Hub
A logistics hub is a central location where goods are received, stored, and redistributed to other destinations.
Components of logistics
Forward and reverse flow of goods
Storage of goods
Services such as insurance related information between destination
Forward Flow of Goods
Is the deal with the flow of products from the factory to the consumer
Reverse flow of goods mean
This usually involves returns, recalls, repairs and refurbishment, packaging for restock or rescale, recycling and disposal
Supply chain activities
1) Transformation of natural resources;
2) Movement and storage of raw
materials;
3) Processing of raw materials and
components into finished goods;
4) Storage of work-in-progress and
finished goods;
5) Delivering the finished product
from point of origin to point of
destination.
Distribution
Distribution refers to
storing and moving
products to customers.
Chain of
Distribution
The chain of distribution or channels of
distribution is the series of stages or
intermediaries or agents that finished
product goes through to reach the
consumer.
Chain of Distribution Links
❑ Manufacturer – produces the goods
❑ Wholesaler – buy goods from
manufacturers or dealers or producers in
large quantities and sell them in smaller
quantities to retailers.
❑ Retailer - provide goods directly to the
consumer
❑ Consumer – purchases the goods and
services for personal use
Transportation
Transportation is the
movement or
conveying of goods
from one point to
another.
Factors influencing the choice of
Transport method
❑ The geographic distance between channel members.
❑ Domestic trade or international trade.
❑ Nature of goods to be transported e.g. fragile or perishable items;
large bulk items,; items needing high security; dangerous chemicals
requiring special containers.
❑ Cost of transportation method.
❑ The availability of ports of entry and exit e.g. airports, harbours, ports.
❑ Handling charges and insurance costs e.g. freight costs.
❑ Availability, location and costs of warehouse facilities.
Modes of Transport
❖ Multimodal
❖ Intermodal
Multimodal Transport
Multimodal transport (also known as
combined transport) is the
transportation of goods under a single
contract, but performed with at least
two different means of transport;
Role of Transportation in Marketing
The role of transportation in Marketing is to:
❑ fast-track sourcing of commodities;
❑ ensure security of supply;
❑ cost reduction.
