What is logistics?
We live in such a world where people need different things - food, house, clothing, medical care, education, entertainment and so on. These “desires” lead to large “demands” for goods and services. To meet the demands producers all over the world should provide enormous quantities of goods and vast amount of services, each with its special requirements. Those supplies pose the logistical problems. We must either move the goods to the consumers who want them or move the people to the places where the services can be used.
Nowadays, efficient logistics and transportation system are important premises of the development of any economy. In modern competitive environment, it is not enough to suggest a product that meet customers’ demands. The way of its delivery is very important as well. The art and science of delivering goods with speed and accuracy can help businesses operate more effectively, cut down costs and get new customers.
Logistics is the skill of operating and controlling the flow of goods, energy, information and other resources such as products, services and people from the source of production to the market. It is difficult to fulfil any marketing or manufacturing without logistical support. It involves merger of information, transportation, inventory, housing, material handling and packaging. The managing responsibility of logistics is geographical repositioning of raw materials, process and inventories. They are demanded at the lowest cost.
Logistics is a composition of a quantity of professional functions, such as planning, coordination, controlling, warehousing, directing, forecasting, transportation, location and management.
Logistics managers unite general knowledge of each discipline to accommodate the resources of the organization. There are two different forms of logistics. The first one optimizes a steady flow of material through a network of transport links and storage points. The other coordinates a chain of resources to carry out some projects.
On a national scale, logistics involves a great amount of effort. The USA has a gross domestic product (GDP) of $10 trillion, so its population of 280 million produces and consumes an average of $36,000 of goods and services. The world's seven largest economies - USA, Japan, Germany, UK, France, Italy and Canada - have a combined GDP of $20 trillion. All of this relies on logistics to pick up materials from suppliers and bring them to customers. Millions of people are involved in this process, and it costs billions of dollars a year to keep everything moving.
