1.
0 Questions
1. How has logistics helped Walmart?
(Hint: By effective logistical system, Walmart has reduced operational costs and provided
products at low prices.)
- Walmart was able to source materials internationally with the use of effective logistical
system. Also, they were able to keep the operational costs low and deliver its promise of
making finished goods available at low prices.
2. What is the importance of logistics in achieving customer satisfaction?
(Hint: Providing finished goods at low prices and at the right time.)
- The logistics activities within a business try to satisfy customers through achieving the
bill of rights of logistic thru effort to deliver the goods and services of the right product
up to deliver it at the right time without delay to the right customer at the right cost at
favorable low prices.
3. What is the reason behind price war among retail organizations?
(Hint: High level of competition and advancement in logistics.)
- Due to high level of competition, retail organizations waged price war in the industry.
That is why majority of retail organizations were reducing operational costs and selling
finished goods at low prices in order to fascinate customers.
4. Where does Walmart procure its materials from?
(Hint: Walmart procures its materials from India, China and Brazil at cheap rates.)
- Walmart acquire its materials from India, China and Brazil due to the availability of
materials needed (at a low cost) to convert raw materials into finished goods and they can
be their permanent business suppliers in a long-term business relationship.
5. How is Walmart so efficient in its logistic function?
(Hint: Walmart owns about 3,000 long-haul trucks, 2,000 trailers and utilizes information
technology for logistics activities.)
- Walmart proficiently exploits information technology in increasing the effectiveness of
its logistics activities. A number of distribution centers of retail organizations are linked
via advanced information technology tools to ensure viable coordination.
2.0 Exercise
1. Describe the concept of logistics management.
- Logistics management refers to the acquisition, storage and transportation of inventory
from its origin to its destination. It involves maintaining the inventory, resources and
related information, and getting the goods to the right location at the right time and to the
right customer.
- Logistics management is an efficient tool to help businesses maintain a sustainable
process. Logistics management is the most effective way of managing various supply
chain functions. It is a critical element to the company’s financial health as it enables
businesses to provide customer-centric services. Therefore, adding more value to the
customer experience by enhancing the operational activities is important for achieving
organizational goals.
Reference:
https://www.gep.com/knowledge-bank/glossary/what-is-logistics-
management#:~:text=Logistics%20management%20refers%20to%20the,and%20to
%20the%20right%20customer.
2. What are the objectives and importance of logistics management?
a. Minimun Variance
b. Ensure minimum cost - Embracing logistics management is the best way to drive up
revenue and reduce the overall cost of the supply chain operations. It allows optimum
utilization of raw materials and faster delivery of products which help companies to
gain a competitive advantage. However, streamlining a complex network of
operations and management of goods is useful in minimizing the logistics cost.
Controlling and managing the supply chain ecosystem with intelligent route planning
can also enhance business productivity.
c. Ensure Quality Services – The quality should be maintained throughout all facets of
the logistics industry. Companies should take thoughtful efforts and always perform
activities out of a supervisor’s vision. Monitoring the quality of overall logistics
operations by utilizing new-age technologies can improve business growth. Quality
assurance is considered to be one of the major aspects of the objectives of logistics
management.
d. Rapid Response Capability
Reference: https://www.youtube.com/watch?app=desktop&v=u0Q0vtqLouw
3. What is the scope of logistics?
- The scope of logistics management involves order processing, inventory control,
transportation, warehousing, materials handling, and packaging, all integrated throughout
a network of facilities. The goal is to support procurement, manufacturing, and customer
service operational requirements. It aims internally to coordinate functional competency
into an integrated operation focusing on serving customers (internal); and externally, to
ensure operational synchronisation which is essential with customers (outside of the firm)
as well as material and service suppliers to link internal and external operations as one
integrated process.
4. Discuss the role of logistics in an economy.
Logistics management is all about managing goods manufactured by the companies. It is
the business process that starts with the flow of material from the suppliers’
manufacturing house, then to the customer through the distribution channel. Logistics
management includes the planning, implementation and controlling the efficient and
effective flow and storage of goods from the point of origin to the point of consumption.
To resolve the conflicting issues, organizations should implement best logistic
management practices. Organization should focus on collaboration rather than
competition. Good collaboration among transportation providers, buyers and vendors
helps reduce expenses. An efficient and safe transportation provider is also vital to
business success. Logistics management is incorporated within the supply chain system.
5. Describe various types of logistics
a. Business Logistics: It is the systematic and coordinated set of activities to provide the
physical movement and storage of goods, services, and related information
a. from the point of origin of the vendor or the supply services through company
facilities
b. to the point of consumption (customer/market)
c. and the associated activities (like packaging, order processing)
d. in an efficient manner necessary to enable the organization to contribute to the
explicit goals of the company and meet customer requirements.
b. Materials Management: Materials management is the planning, organization and
control of all aspects of inventory, embracing procurement, warehousing, work-in-
progress, shipping, and distribution of finished goods. It is the inbound logistics from
suppliers through the production process, the movement and management of
materials and products from procurement through production.
c. Physical Distribution: It is the movement and storage functions associated with
finished goods from manufacturing plants to warehouses and to customers.
Distribution relates to outbound logistics, from the end of the production line to the
end user having activities associated with the movement of material, usually finished
goods or service parts, from the manufacturer to the customer. These involve the
functions of transportation, warehousing, inventory control, material handling, site
and location analysis, packaging, and the communications network necessary for
effective management.
d. Supply Management: Supply management is the act of identifying, acquiring, and
managing the resources and suppliers that are essential to the operations of an
organisation. It includes the procuring of physical goods, information, services, and
any other necessary resources that enable a company to continue its operations. The
main goals are cost control, the efficient allocation of resources, risk management,
and the effective gathering of information to be used in strategic business decisions. It
is a systematic business process that goes further than procurement to include the
coordination of pre-production logistics and inventory management.
e. Decentralized Logistics Management: Decentralized logistics management is based
on the premise that a company needs to decentralize its operations to enable the
organization/company to respond to the local needs. Any company while dealing with
different local specific cultures requires inputs from the dispersed/ local
organizational units. The managers who deal with the local cultural variations daily
normally know what works and what does not. The product moves further away from
the key stakeholders at the central corporate office and closer to the end customer.
While this can be accomplished through self-owned warehouse and logistics, a
managed decentralized logistics network is far more suitable than its counterpart.
Reference: https://egyankosh.ac.in/bitstream/123456789/72278/1/Unit-2.pdf
