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Logistics Management and its importance

English

22 February 2022

By definition, logistics is a set of methods and procedures necessary and designed to achieve the organization of a company, logistics management, in order to carry out its goals or objectives. We can say that logistics management is a fundamental part to achieve efficiency in the supply of products or merchandise, from its point of origin or production, to the consumer.

Importance of logistics management

Logistics management allows the company to efficiently obtain, use, distribute, transform, store and guarantee the optimization of its resources. The raw material, product or goods and services handled in accordance with the design of logistics management is the most important resource of a company on the road to success.

It also allows the company to track the product in all its phases, production, transportation, storage, among others. If all the steps are carried out in an orderly manner, the company will be able to meet the demands of its customers, since the demand will be met in a timely manner, which will result in its economic benefit.

We say then that the implementation of a well-designed logistics and its optimal management in the operation and control of production processes, control, economy and profit of the company will lead us to a successful organizational strategic plan.

Fundamentals of logistics management

The basis or the main foundation of a proper logistics management is and must be the speed of response. That is, the company must be able to respond to its customers in the shortest possible time, obviously to achieve this it will be based on its logistics management, meeting the response times established and / or expected.

If the control of production, location, quality, distribution, inventory and delivery is strict and attached to the logistics, all resources of the company will be optimized and this means that it will represent savings and profit.

The market in its constant evolution has demanded the development of new concepts of economics and marketing, providing a kind of guide for logistics management as is the Cross Docking model, a method that seeks to avoid prolonged storage or bulky inventories of goods.

guys working with a pallet in a warehouse
Warehouse worker

Mechanisms for Proper Logistics Management

We must be aware that any kind of event that hinders or slows down the economy of our supply chain will hinder logistics management. That is why we must avoid the following aspects:

  • Flawed processes such as repetition of the same process.
  • Static inventories such as complications due to lack of rotation and/or mobility of stored goods.
  • Misuse of resources and/or poorly estimated costs of inputs or merchandise.
  • Compliance with excessive legal, fiscal or bureaucratic requirements.

Benefits of Logistics Management

  • Satisfied Customer: A good, efficient and easy-to-use Logistics Management system allows the company to make deliveries with greater speed and fewer interruptions, which will make it more reliable for its customers.
  • Control and audit: If the processes are clearly defined and carried out, the company will be able to evaluate not only the mechanisms but also what needs to be improved in them, giving the customer a guarantee of the quality of the product he receives: confidence.
  • Optimization of Economic Resources: If the company can clearly and accurately track all the processes of its operation and production of its goods or services by managing them properly. That is, from the raw material to the final product, it will avoid delays in all the steps involved. Therefore, the costs will be within the estimated without causing additional expenses, that is, if we meet the guidelines in logistics management, the company will be able to optimize its expenses and it will be possible to save.
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