Create a Receipt for Services Rendered for Logistics Effortlessly

Receipt for services rendered for Logistics

actually remember the war times and also the military issues that's true because it is essentially a military term and you know the activities of logistics have been since the creation of humanity study of logistics started with 1900s as a scientific way and if you look at the 1901 there is a published article which was by John grobbel it discussed the logistics from a strategic point of view and when you come to 1905 the colonos Chelsea Baker used Logistics to Define military function as the you know transport Supply maintenance and Replacements of materials and Personnel during the war so in 1916 our show introduced the concept of distribution Channel and in 1960s by wealth in 1927 by borsodi to find the concept of Logistics in ance with today's usage but indeed with the start of second world war this is a very important you know uh date because between 1939 to you know the end of the world logistic has been well developed and its importance has been fully clarified because Logistics superiority healthy and lies win the war in World War II when we come to 1960s maybe you know about Peter Drucker he is one of the business Guru stated that Logistics was one of the most important factors to increase the efficiency of businesses which is very true in today's world as well and in 1961 the first book on logistic was written in United States and when we look at 1963 the National Council of physical distribution management was established and this name the name of this console was changed to Council of logistics Management in 1985. uh what is the aim of this console uh it is the developed the theory of logistics and increase its awareness by providing an understanding of logistics processes from 1960s to 1980s many books articles papers various Works were written about logistics especially the concepts of distribution resource planning materials resource planning kanban and just in time Concepts have been discussed in the literature and in 1972 for example Michael Schiff examine the relationship between accounting and Logistics in his book an invasion on this 19 between the 1970s and 1980s countries especially United States removed the restrictions on Transportation which we call it their regulation and paved the way for air train Land and Sea transportation and again if you ask people mostly when you say Logistics people understand as it is a transportation that's true because transportation is one of the core activities of logistics and usually people think about logistics Transportation but actually logistic is more than Transportation uh Transportation included in the logistic activities but it is not enough we will talk about warehousing purchasing inventory management even customer service and Etc so in tonight in in the United States let's start with transportation of course the regulations enabled businesses to switch to more competitive and free structure of course so freedom of price flexibility in scheduling and routing has paved the way for emergence of new and diverse services in 1980s as you know computer technology developed tremendously in the world and gradually began to enter all areas of life and in this direction it was not too late for computer to enter of course to the logistics life especially in the fields of inventory management scheduling order management and routing the use of computers has developed quite widely at the same time you know in 1980s another important event happened globalization which you know business started to supply their needs overseas from various countries for example such as raw materials also they use the labor of these countries and the spare parts from every corner of the world so companies were now able to expand to every part of the world which makes the logistics activities even more important because we need now transportation and warehousing more than before so now I would like to uh explain the logistic Concept in uh you know four phases uh three phases basically let's look at remember the mass production phase right because the interest and Logistics stems from complex developments of Industry especially in United States especially after World War uh you know seconds of course the mass production starts very early especially fourth if you remember fortism but after the world was second it is increasing much more uh efficiently at first the only issue that was given importance was production at this point organizational principles also technical developments were applied in production USA lags behind behind you know England in development and a lot of effort was made to make for it so mass production must require close discount and make large Investments That was required for mass production as the scope of Investments and the resulting Capital increased productivity also increased so use the U.S and the second phase of the Industrial Development which is afterness production emergence of large firms so now the business world has become more sensitive to changing economic conditions because of of course the globalization pushed the countries as well because now everybody can't you know compete with other firms in other countries so economic conditions and also aim to grow with less competition and again United States transition from single person management to group management which are corporations so the second phase of Industry coincide with the emergence of large firms then if you look at stage phase 3 marketing right because since the production has increased so much the market couldn't consume it so there is a you know more than what is demanded so organizations now needed to increase their sales with certain geographical boundaries that they they had to sell these products otherwise the inventory costs become uh very uh very much so those the marketing game great importance in this third phase so expert marketers were essential to retain or expand the existing Market if you remember 1980s uh really the sales uh if you become very important in marketing especially we are all concerned that marketing is equal to sales no it is not marketing is much more a wider concept but sales becomes so popular in those years because companies won't get rid of their extra products they don't want to pay extra inventory costs and when we look at phase four now it is time about the logistic and distribution because in the mass production production increase but it was getting harder and harder to deliver the goods from producer to the consumer so the production line eventually went into a bottleneck this problem came to the fore in the fourth phase so the solution was of course about logistics and distribution in the early stages of distribution phase it became popular to store the products at different points but even that was not enough so urgent shipping with high charges were required some companies even set up their own shipping companies so all the face of logistics change in this phase four so companies started to look around the solution how we're going to manage all these setup so it's basically there are three stages of development of logistics I will take from 1960s to 1980s as the pigmentation because companies see the activities of logistics separately in those years with some following corporations such as demand forecasting everybody do their own did their own um demand forecasting what what I mean retailers do their own demand forecasting producers make their own demand forecasting suppliers make their own forecasting so everybody separately working on separate activities purchasing requirements planning production planning Inventory management every party included in this system working actually audience and also some of them are Outsourcing but still they are working separately this is called fragmentation yeah sorry yeah in the second stage it is called the merger it is between 1980s to 2000 the logistic activities in this period grouped under two concepts first of all material management and the physical distribution when I say material management I am talking about inbound logistic activities which is between suppliers and the producer then I talk about the physical distribution I'm talking about outbound Logistics which is between producer to consumer or producer to wholesaler retailer and customer or producer to retailer to the consumer when we look at the total integration which it started at in 2000s now still continues this process which is still ongoing has brought up together and got activities given the fragmentation and merger section Under One Roof so globalization in the world economy also liberalization and in parallel with this the efforts to adapt to the companies have increased importance of logistic activities and reveal the concept of integrated Logistics today it manages to stay one step ahead of the competition which can coordinate all these Services which are described as integrated Logistics Solutions on behalf of its customers and which can offer its customers as a single system by harmonizing all Logistics subsystems which each other what I'm talking about purchasing demand forecasting Transportation warehousing all these logistic activities plan together and become integrated within the supply chain because supply chain concept also evolved in those years we will talk about today after that let's now Define what is logistics actually uh Supply Chain management professionals Define logistics as it is planning implementation and control of efficient and effective movements and storage of materials Services information flow in both directions this is important in supply chain from starting point of raw material which is coming from the suppliers to the endpoint of console and consumption of the product to meet the needs of customers another definition is given by International Federation of freight forwarders Association they Define logistic as all kinds of customs and financial matters such as Transportation consolidation storage handling packaging and distribution of products as well as auxiliary and consultancy services as well as customs declaration of products Insurance collection or making of payments and other documentation related to the product is service this is logistics services that we provide in those years and if we combine it is seen that it includes absolutely inclusive processes of planning and control of the flow of products and services from points of supplier to the consumer in ance with customer needs and it's seen that these flows cover processes such as Transportation storage packaging and handling of the product we have seminars of logistics what are they the right product at the right quantity in the right condition at the right place the right time in the right cast to the right customer with the right price these are the seven hours of logistics seven rights of logistics which is you know maybe seems so so difficult to achieve right but Logistics achieve this seven eyes of logistics because all products all around the world be in time with the right condition in the right place to the right customer and trying to achieve the cost balance in these services it's a miracle correct now I would like to review the economic effects of logistics because Logistics both in the world in Turkey Turkey is my country I know I'm not sure where you joined this uh you know training but the turkey is one of you know um good companies because it's a bridge it's it is in the middle of both Africa and you know Asia Europe Russia everyone you know it's it's a very geographically important country that's why we are good at Logistics I can easily say we have shortcomings as well but still um I will talk about Logistics in the world and turkey also about microeconomic impacts then you know the logistics provide some micro benefits first of all ownership utility right because if you deliver the goods to the needed place bit you know in the meantime and in the right shape and in the you know uh correct amount then we uh you know match the benefits ownership shape space and time utilities these are the economic benefits of logistics now let's talk about the logistic industry in the world a little bit uh while it is stated that Logistics sector is one of the locomotive sectors of countries uh Georgetown University logistic directors Professor Ricardo and states that 25 of every dollar purchased every dollar produced in the world goes to Logistics services this is not you know uh less it is very important what he says and ing to the new report of Transport intelligence the total Global logistic Market size is 6.6 trillion in 2019 and the industry is expected to continue to grow strongly in the coming years and then we come to this year because of a pandemic the expectations were high and then some downturn you know uh negative things happen but then now it becomes recovered apart from the United States and Europe which have more than 50 percent of world logistic markets uh cities such as Dubai and Hong Kong have been rapidly advancing towards becoming a logistic base and regions that will increase in importance are as you know Asia Pacific Eastern Europe Russia and the Middle East respectively again due to the pandemic global trade contracted by 9.6 in 2020 while Global uh gross domestic products ranked by 3.3 percent so these rates are the most critical rate of shrinkage since the Second World War uh which is very interesting and the logistics sector is one of the most affected sectors all over the world as you know because of pandemic after the first shock experience during pandemic process if you look at my country the Turkish logistic industry which managed to eliminate the effects of the crisis by taking action quickly but couldn't be isolated from structural problems of global logistics industry answered into a struggle due to greatly increased expense items and this pandemic crisis wrote logisticals to the highest level and many factors trade for example freight costs become very high many factors that increase the cost in logistics sector emerged in the fact that the vehicles carrying the goods exported from our country in Turkey for example had to return empty within the framework of import restrictive measures as an impact on freight prices of course the increase in fuel prices increase in exchange rates Road and toll fees increased entire spare part prices can be counted Among The prominent expense items of logistics sector which has a large share in our country's service exports so this increase in logistic cost directly affects the prices then transported could reach the final customer of course and if you remember the container crisis Beauty Chinese ports if you remember affect the freight prices as well however despite everything turkey whose conductor is closely to load on the way to becoming a Transit country and Trade Center and which is a bridge between the Middle East and you know Turkey Creek Turkish republics and Europe is becoming more important for many countries countries as it is a Transit currently vote for lands the air and pipeline and although there are major disruptions in the logistic industry in the whole world it kills environment experience especially in the first period of pandemic these purchasing Tendencies towards turkey after some global companies which couldn't provide adequate service and supply from China as of 2020 so which they are purchasing operations to Turkey we call it near sorry so most of the developed Western countries get rid of offshore and started to reassure or near shore and turkey is maybe your country I don't know where you live but maybe your country gets some advantages out of this pandemic process about logistic activities and it comes to you know you know achieve some uh advantageous situation of this if you look at logistic industry the threats there are lots of threats one of them is increasing National and international competition another one is geopolitical problems technological inadequacies need to adjust companies to informal markets of course inability of companies that have not sold the scale problem to gain the competitive power sustainability becomes more difficult if it's not persistent in maintaining these are the threats that we face in today's logistic industry but again we have a lot of opportunities one of them is reputable open trends of logistics sector at home and abroad opportunities to positively affect process efficiency with digitalization within the framework of International Development the tendency of the Mediterranean region to become a logistic Hub is high increasing demand for institutionalized logistic companies and economic growth being to driving force for the logistics sector in Turkey for my country for example actually I put some information about turkey in here but I'm not sure if you are interested in Turkey so I you know delivered these uh notes to you with the slides if you are interested you can always read it so I will skip these slides if you know you are not interested in Turkey I will continue with definition and also as we Define again please uh you know remember it's a process of planning implementation and controlling starting with from supplier to deliver to the consumer and I know that Logistics is time related positioning of resources our strategic management of the total supply chain so what is the aim of logistic it is the achieve High Cost of action of course so it must provide a high quality service with low or acceptable costs uh the role of logistics I can show this figure to you as I told the inbound Logistics I can separate the demand Logistics and output Logistics in the middle there is the operations within the organization this is usually usually a focal firm let's say a producer and on the left side the external suppliers which are the raw material supplier or components or whatever you Outsource these are the suppliers inbound Logistics part and then once it gets into the raw material you saw you know coming to the producers Factory there is repetario's Management in here we have some internal suppliers internal customers which is uh you know in our system and when we transform we produce the final products then it is time to deliver them to external customer these external customers can be final consumer or can be a wholesaler or produce or retailer so you will see the entire this is the Supply Chain management and we see all Logistics in both sides of the uh supply chain and uh I would like to link the logistics strategies with competitive Advantage strategies if you remember Michael Porter each organization first of all designed its own strategic Logistics but they often Move Along similar lines so the logistics strategies of Fort or Volkswagen for example are broadly similar as are the strategies of Lufthansa and Air France is similar this allows us to describe few generic strategies which are based on Michael Porter's basic strategies what are they if you study business you already remember maybe he offers one course leadership makes the same or comparable products more cheaply second is product differentiation makes the products that customers cannot get from other suppliers so your Logistics can be either from cost leadership site or from the product differentiation site if you prefer the cost leadership I can offer you a logistics strategy of lean strategies which is no organization can completely avoid the cost of logistics so the next best option is to make it as cheap as possible then a reasonable objective is to minimize the total cost of Logistics while ensuring acceptable levels of customer service is several approach is called lean Logistics it's coming late sorry yeah early work on lean operation was done in the motor industry led by Toyota first uh so lean strategies are coming from Toyota so these were concentrated only in production but the methods got such good results so they spread in other areas eventually developing a lean Enterprise if we need to summarize the lean perspective there are five main principles value designing a product that has value from a customer's perspective of course value stream designing the best processes to make the product value flow managing the flow of materials through the supply chain pool only making products when there is customer demands and there is there are actually I would like to uh talk about a little bit in here there are two uh strategies pull and push push means you produce a lot make the stock and then you throw you try to sell them to the market this is called push you produce more and you try to push to the market but when we look at the vice versa the pool strategy you're making products if there is a customer demand so make to order means uh and these strategies are based on full scenarios and the fifth principle is aim of perfection looking for always continuous improvements uh Kaizen philosophy to get closer to the aim of the perfect operations these are the principles of Leaning strategies the first of these principles Value First sets the target for the organization and seeing how to add value for the final cost customer of the product second principle value stream designs means of making this product and effectively sets the requirements of the supply chain and the last three principles refer directly to the supply chain so the third value flow gets an efficient flow of materials eliminating the waste interruptions waiting and also the detours the fourth principle tool shows how to control the flow of materials by pulling them through and the fifth principle aim of perfection describes a continuing search for improvement this is common theme for management initiatives which often say that areas of waste should be continually identified and eliminated uh thousand says that all organizations are at least 250 percent based waste people waste effort waste space waste time Toyota during their development of work Identify some areas of supply chain where this base is most likely to occur for example quality that is stupid to satisfy customers raw production level of capacity making products or having capacity that is not currently needed poor process having unnecessary too complicated or time-consuming operation is a waste right waiting for operations to start or finish for materials to arrive for recruitment to be repaired and so on movement with products making unnecessary long or inconvenient movements during the operations and the stock inventory is holding too much stock increasing complexity and raising cost these strategies always announcement just in time systems Toyota used just in time systems which means almost no stock no inventory holding uh and it is very you know uh critical issue to be a manage everything in just in time if you are interested in this in the supply chain class we talk about much more um complicated of these issues give much more information about tutorial strategies but in this part you it is enough to know that logistic that is managed by lean and strategies you need to get rid of these waste areas and try to focus on cost reduction and of course you cannot get rid of customer service but you know balance customer service is enough a lean strategy looks for ways of eliminating waste as I said the typical approach does a detailed analysis of current operations of course and then remove the operations that at no value to the chain and eliminates delays simplifies movements reduces complexity uses higher technology to increase the efficiency looks for economies of scale always locates near to customer to save travel and removes unnecessary risks links from the supply chain one warning is that locals do not automatically mean lean operations okay it we are not talking about cheap strategy lean operations maintain customer service while using fever resources they do not just minimize the costs for example a green grocery could minimize it in naturally cost by having no stock but it will not generate much customer satisfaction some people also suggest that lean operations must might work in the mass production car industry but lessons do not necessarily transfer to other Supply chains so in particular lean operations might not work when there are variable and uncertain conditions so there is an alternative more flexible strategy we can offer which is called agility maybe you heard about agile Supply chains right energy strategy concentrates on the other side of the efficients versus responsive or lean versus agile it's supporters say that lean operations put too much emphasis on costs and cannot deal with changing conditions increasing competition or more sophisticated and demanding customers for example if demand for a product is steady at 100 units a week lean logistic will remove all the ways and have enough capacity to deliver these hundred units unfortunately if demand suddenly Rises to 10 110 units lean operations cannot cope as markets are more demanding demanding more variety and customization Logistics should be more flexible maybe lean Logistics lead strategy is much more suitable for automobile industry but for for example fashion industry agile strategy is better so lean strategy is used by mostly Toyota Volkswagen Ford even use this strategy but agile strategy for example Zara uses agile strategy in order to manage their Logistics strategy is to give a high customer service by responding quickly to different or changing circumstances so you can talk if you are managing a supply chain maybe you can ask a question to yourself how agile is your supply chain um in logistic books we see that Zara is a very good example even it's a patient textile you know Company still it is best known with their Logistics strategies because in all over the world every store of Zara in 15 days they change the Iraq's new products and they are trying to use the pool system instead of cush system you cannot see entire amount the same product instead of this they change they offer too many variety of products and they try to improve their customer service without thinking any other details of lean strategies there are two aspects of agility first there is a speech of reaction of course responsiveness you say agile organizations keep a close check on customer demands and react quickly to changes second it is the ability to tailor Logistics to demands from Individual customers these are for example different aspects of customer service and implication is that and customer satisfaction is a prime concern even if this comes at somewhat higher prices so if you look at agile supply chain strategy you will see sensitivity you will see relationships management you will see processes you will see flexibility and much more information sharing organizations that put a lot of emphasis on customer satisfaction are safe to have customers so justification for this strategy comes from obvious importance of customers without customers an organization has no sales of course no income no profit no business and soon new organization so it's Michael Perry of Unilever says to sustain competitive Advantage requires the total commitment to your customer organizations with their customer focus will typically aim for complete customer satisfaction allow customers easy access to the organization find exactly what they want design Logistics to meet or exceed these demands be flexible and respond quickly to changing customer demands get a reputation for outstanding quality and value do after sales checks to make sure the customers remain satisfied and look outwards so they are always in touch with customers potential customers competitors and so on actually retailer by Unilever talks about this because fast moving products industry is also using agile strategy just because there is too much competition and the customers really look for um you know variety quickness and also very fast delivery especially after electronic trade organizations which satisfy customers have obvious benefits of bringing them back with repeat business right so remembering the rule of thumb that it costs five times as much to attract a new customer as it does to retain an existing one so satisfy customers also attract new business as they recommend a good service to four or five other people and compare with these satisfied customers who've won dozens of potential customers about bad experience remember this now if you compare lean versus agile I cannot say that one of them is better than other there is no superiority over it it is just about your company strategy which what is your company company's competitive strategy if you are looking for cost leadership then you should go after lean strategies but if you are going after differentiation agile strategies go goes better for you but you can also merge them which we call Lee agile you can just make it in a in same pot to make better customer satisfaction with you know optimized costs at First Sight the aims of lean and agile operations seem contradictory one looks to minimize cost and sees customer service is a constraint while the other looks to maximize customer service and see its cost as a constraint so this seems to lead important different differences so if you compare them along with volume and variability of accesses you can see that if your volume is high but variety is less you should pick lean if your volume is less but your variety is much and then you should go agile if you go less if you go more you can do whatever you want you can combine them maybe now I will you know compare these two strategies and with some factors under some factors for example the objective of lean Logistics is efficient operations while ago logistic aims uh to flexible being flexible to meet their customer demand what is the method of lean Logistics it removes all the waste when you look at agile Logistics it it's Methodist customer satisfaction what are the constraints for lean logistic customer service and energy in agile Logistics cost is the main constraint rate of change lean logistic has a long-term stability a giant logistic has a fast reaction to changing circumstances that's why it is uh you know in Israel measures of performance lean Logistics usually measure productivity and utilization but agile logistic measure lead times and service levels if you look at the work how it is done underneath strategies it is uniform and standardized but individual strategies it is reliable more local control and customized and finally the control mechanisms in lean Logistics is formal planning Cycles when you look at the agile logistic it is less structured by empowered staff so what I can see say in here is you see you will have higher strategies that comes from your corporate strategies it goes directly to your Logistics strategy so in the organizations uh you know distinctive competence you should look at your product your employees your resources facilities and other internal strengths and on the other side you should look at your business environment your customers market conditions technology formal economic climate and other external factors so you decide which Logistics strategy is effective for your own Corporation so factors in the design of logistics strategy no one right way to develop and implement this strategy exists the key to successful planning is get the best fit between the chosen tools and techniques the organization's current culture capabilities and business environment and the desired outcome of course so this leads to the usual advice of finding the best balance between the organizations internal strengths and external constraints as I see in the figure so matching to organization is good at to what customers want so now we have three factors that managers must consider when designing Logistics strategy the higher strategies the business environment and organizations distinctive companies okay we talk about this you can see much more details about these strategies but mainly you should really really look at what is you know my what are my customers doing how is the market conditions what is my capability of achieving technology economic climate is very important especially in these days legal rights says competitors shareholders interest groups social conditions political conditions these factors affect your strategy as well all competing organizations work in a similar business environment something another so each can only succeed if it has a distinctive competence that sets it apart from the competitors this is defined by the factors that are under the organization's control and which it uses distinguish itself so instinctive competence stems from organization assets which includes dose those those customers employees finances organization products facilities these are I can say the drivers of your supply chain of your logistic activities okay you should look at these delivery so you will see the levels of decision in logistics mission of company corporate strategy business you know strategies and then Logistics strategy and then logistic practice and of course the logistic operations now Logistics cannot be a part of concept of supply chain in nowadays let's just supply chain consists of series of activities and organizations that materials move through their Journey from initial suppliers to final customers for example outline this is a very simple outline for supply chain for paper let's start with seeding you know ground by The Gardener it becomes a young tree and then planted by the Forester it becomes a major three visible suppliers of course and then felt by the logger goes to Locks chips and become a Bullpup and then processed to turn into a raw paper process become large you know rolls of paper and then finished product is small rolls of finish paper and then you cut it sheets of paper produced and then you press put it to the Picker and then transport to the wholesaler and then transport it to retailer and finally we get as a final call store this is outline of a supply chain for a easy product of paper and if you look at the structure in the holistic way you can see the operations in the organization as the focal firm let's say producer there are suppliers first year and then the suppliers supplier second tier and the supplier supplier supplies 30 and it can goes up to like that in the Upstream suppliers and once you product and produce the finished products then now you go to customers it can be first-year customers or second tier or third tier this is the entire supply chain and there are different shapes of supply chain you can see short and wide supply chain for industrial sand for example queries at the top and customers are like that or part of a long and narrow supply chain that such as Pharmaceuticals you see the initial supplier then component maker then manufacturer then the warehouse exporter and Etc you can pick another you know anything like that so I can say supply chain length is the number of tiers or internment degrees that materials flow through between source and destination and we might think of the supply chain internal suppliers all sellers are retailers so in reality some Supply chains are shorter than this when for example producer says directly to finance Supply chains are often longer with many internment degrees perhaps including several stages of manufacturing Each of which is connected through intermediary similarly exporters might use series of logistics centers transport operators agents straightforwarders Brokers and agents to move materials through different parts of their Journey besides the length there is also a breadth of supply chain which is the number of parallel routes that materials can flow through you can imagine this in terms of the number of routes out to final customers let's say cadburys has a broad supply chain which means that you can buy their chocolate in huge number of retailers Thornton has a narrower supply chain for example most of their chocolate sells through their own shops pigeon Etc feels as a very not memorable chain they only sell their chocolate in two shops in Belgium for example so it is another decision either your supply chain will be breath or light this is a specified Supply supply chain for Distributing shoes UC manufacturer and there is a you know Logistics Center Imports are coming from there coming to there and then Logistics Center it they are separated into a domestic sales or export if you go to domestic sales then either you go to direct sales or distributor if you or a wholesaler if you go to distributor you can use large multiple retailers or small multiple retailers if you go to wholesaler you can go to supermarkets close retailers specialist store shops or mixed retailers and then to the public if you go direct sales you can make mail order website Factory shop or in today's you know electronic trade you can use on you know mobile phones or Internet shopping and it goes both the industrial institutions or public so you can see how we distribute use such a complicated distribution Channel and benefits of supply chain if you see without a wholesaler you see the factories you have 32 routes in order to achieve your access your customers but if you use Intel made theories such as let's say a wholesaler then you can your factories goes to four rows of inwards and then from the wholesaler you can go only eight rows it becomes again four times eight 32 roads but still you use wholesaler in order to be aligned with your customers in math so there are a lot of benefits of well-designed Supply chains of course uh because if you use internet units producers locate in operations in best locations regardless of the locations of their customers by concentrating operations in large facilities producers can get economies of scale also producers do not keep large stocks or finished goods as these are held further down the supply chain nearer to customers retailer help us talk wholesalers Place Large orders and producers pass on lower unit costs in price discounts for example or again using wholesalers helps us to keep stocks from many suppliers giving retailers a choice of foods again wholesalers are near to retailers and have shortly times retailers carry less stock as wholesalers provide reliable deliveries and retailers can have small operations given a responsive service near to customers transport is simpler with fever larger deliveries reducing costs and organizations can develop expertise in specific types of operations now I would like to review the logistic activities that we took actually logistic originally limited to transportation in a warehouses but it extended to include the purchasing distribution Inventory management order management processing I could drink handling labeling parts and service support production scheduling returns right reverse logistic activities demand forecasting Waste Recovery disposed and even customer service so in addition to transport and storage Logistics which include packaging value added Services stock management order management Insurance Customs Brokerage inspection and surveillance activities applied ing to demands and needs is an important stakeholder for all sectors with its competitive power enhancing functions so you see this circle in here Logistics system you see a lot of activities within this system also you can see uh raw material Exposition let's start with purchasing render selection when the location inbound Logistics which includes the consolidation transport mode selection carrier selection Materials Handling warehousing back hole management and transformation includes immensely management and packaging open Logistics includes Network design inventory decision packaging consolidation all the same inbound Logistics and then marketing serviceable and channel decision and after sales return sending parts management and service Networks so these are the logistic activities and from this night tomorrow we will start talking about purchasing procurement customer service demand forecasting these activities we will start tomorrow night and we will continue with warehousing invention management and Etc but today I will just give a you know brief information about that procurement or let's say purchasing which is the flow of materials through an organization is usually initiated when procurement sends a purchase order to supplier so this means that procurement finds treatable suppliers negotiate terms and conditions organizes delivery arranges insurance and payment and does everything needed to get materials into the organization so in the past this has seen a large degree clerical job centers on prod order process inward transporter traffic actually moves materials from suppliers to the organization receiving area so this has to choose the type of transport find the best transport operators design a route make sure that all safety and legal requirements are met get deliveries on time that's reasonable cost and so on receiving make sure that materials delivered correspond to the order acknowledges receipt unloads the delivery vehicles inspect methods for damage and Source them once you receive the product where you receive them into the warehousing or Source maybe which moves materials into storage area takes care of them until they are needed and many materials need special care such as frozen food trucks alcohol in bonds chemicals that emit the fuels animals and dangerous goods so as well as making sure that materials can be available quickly when needed warehousing also make sure that they have the right conditions treatments and packaging to keep them in good condition once you store them of course you need to make some stock control and which sets the policy for inventory and it considers the materials to store overly investment customer service stock levels order sizes order timing and so on and then until the order begins which finds the removes materials from stores typically materials from a customer order are located identified checked removed from direct Consolidated in the single load wrapped and moved to departure area for loading onto delivery vehicles which will come to material sending move to materials through the operations within an organization so it moves materials from one operation to the next and also rules materials picked from the stores to the point where they are needed the aim of material handling is to give efficient movements with short Journeys using appropriate equipment with little damage and using spatial packaging and handling where needed and outward transport of course takes materials from departure area and delivers them to the customer the physical distribution management is general term for activities that deliver finished cost to customer including outward transfers it is often aligned with marketing and forms an important link with Downstream activities and finally recycling returns and waste disposal even manned products have been delivered to the customer the work of logistics may not be finished that might for example be problems with delivered materials perhaps they were faulty too many were delivered or they were drunk type and they have to be collected and brought back sometimes there are lots of nutrition deficits so we call it reverse Logistics okay another logistic activity is location some of the logistic activities can be done in different locations stock stock finish goods for example can be held at the end of the production mostly nearby warehouses put into stores nearer to customers and test onto the managed by other organizations or range of Alternatives so logistic has to find the best locations for these activities or at least play a significant role in decisions maybe you don't think that location selection is a logistic activity but it is so it also considers related questions about the size and number of facilities so there are important decisions that affect overall design of supply chain Network design of supply chain and communication alongside the physical flow of materials is associated flow of information these links all parts of supply chain passing information about products customer demand materials to be moved timing stock levels availability problems called service tables and so on so coordinating the flow of information can be very difficult and logistic managers often describe themselves as processing information rather than moving to coach Christopher Martin Christopher is a professor supports this view by saying that supply chain competitiveness is based upon the value added exchange of information so you see the summary of logistic activities again and again and from that day now you will see all these activities in detail in different parts but I can underline in here integrating Logistics because fragmenting Logistics into different parts has a lot of disadvantages giving different often conflicting objectives within an organization also duplicating effort and reducing productivity giving worse Communications and information flows between the parties reducing coordination between the parts leading so lower efficiency higher costs and worse customer service increasing uncertainty and delays along the supply chain making planning more difficult introducing unnecessary buffers between the parts such as stocks of work in progress additional transport and administrative process you know procedures of curing important information such as total cost of logistics and even Logistics and low status within an organization what we need to do integrate the logistics within an organization as all the related activities working together as a single function this is responsible for all storage and also movements of materials throughout the organization it tackles problems from the Viewpoint of all organizations and looks for the greatest oral benefits some organizations I tend to stop when they reach this stage and they work with two functions matter is management which is I said align with the production and looking after the inwards flow of materials special raw materials and they move on through the operations and physical distribution aligned with marketing and looking at the outward law of Industries another factor that encourages internal integration is analysis of total logistic cost we can Define this as total logistic cost is equal to transport Cost Plus warehouse Cost Plus stockholding costs less packaging Cost Plus information processing calls and other logistical or has so how can you not integrate all these things because they are related with each other and it affects the overall cost of logistics there are three levels of logistic integration if you decide to do that the first one is separate functions within an organization you see that all logistic activities are separate B is integration within the organization it is so much better but if you look at integration along the supply chain it is it includes the external integration with the supplier and also the customer which is preferable in today's business world we see a lot of benefits of integration gnu cooperation between all parties within the chain which shares information and resources lower cost UT balance operations lower stocks less Expediting economies of scale elimination of activities that waste time or do not add value and so on improved performance due to more accurate forecasts better planning higher productivity of resources rational priorities and so on and improved material flow with coordination even faster and more reliable moves better customer service with shorter lead times fast deliveries and more customization more flexibility which organization reacting fasting to changing conditions standardized producers becoming routine and well practiced with less duplication of effort information planning and so on and reliable quality feeble inspections and integrated quality management programs are the benefits of integration so uh when the time comes that logistic becomes much more complicated and businesses started to focus on their core competences and it is not easy for them to manage their own logistic activities so this you know a threat of Outsourcing becomes a common form of partnership of logistics has a specialized company looking after for all uh of an organization transport so this Arrangement has advantages of inefficient and experienced Specialists to look after the transport while the organization can concentrate on its core operations but why stop at transport an organization can form Partnerships with other companies to look after their warehousing services purchase of materials Materials Handling and many of other functions of logistics so when one company uses other companies to run its Logistics it is called third party or contract Logistics in literature there is always a gap between production and consumption one of the marketing Guru mentioned this cap has been filled by several internet duties within the marketing chain so the function of these middlemen have been highly dependent on each other and there has been no way to eliminate these functions with these middlemen has removed from the system the importance of marketing and logistic function has become become clearer it is explained more importers value chain framework this is you see the primary activities and support activities right so introduce functional School of total marketing Theory using middlemaning distribution channels become necessary for acquiring different logistic functions sharing the risk in the channel and financing the operation and Etc so in order to sustain competitive advantage in the market firms should consider how to maximize their value while minimize their costs in their decisions about management of logistic activities if you look at the um uh tpng third new logistic benchmarking study there are some reasons of Outsourcing Logistics services for firms as listed cost reduction utilizing information technology and an effective Inventory management but also razakhan sang in 1998 review some other reasons for outsourcing improved productivity measurements increasing cost efficient following competition management demand for a financial contribution for all sectors of companies mergers and Acquisitions that require keeping assets of the books need to move inventory faster need for flexible production and Rich attachment to Core Business these are their reasons for companies the Outsource Logistics services the terms which adult supply chain strategy are more open to all sorts Logistics services as Anderson and others mentioned the requirements of coordination communication and collaboration with other parties in the supply chain directs companies something issues also they have the opportunity to reduce capital investment in facilities equipments Information Technology Manpower and inventory it can be more flexible quick response to Market needs and gain access to know how logistical sourcing is enabled by broad range of logistics service providers there are five kinds of logistics service providers 10 years Freight forwarders career and express and parcel portal Services third party contract Logistics services and third party Logistics service providers if you look at the carriers this is typically all logistic assets and consensus mainly on supplying transportation services there are mostly confined to either Road cereal or rail transportation and only in few cases also offer combination of these services and they receive their orders either directly from the customer or through the freight forwarder with their service portfolio catered to needs of traditional Logistics of third base of logistics that's why we call it a first party of logistic providers it's not a logistic provider though it's just a carrier with increasing sophistication of logistic processes you heard about Freight forwarders which addressed the growing needs of customers by offering coordinating functions and intermediating services they bundle transportation services offer warehousing and increasing close to a supply combination of two while the focus of freight forwarder Services still on providing physical processes they also carry out additional services such as Transportation Planning and management including providing the associated information systems and also sometimes act as carriers by using own assets for transport or warehousing overall the freight forwarders in their coordination and coordinating function address the needs of firms which are located in the second phase of logistics PPS or contracts Logistics service providers focus on business customers and provide service packages that carry it out on a longer term contractual basis the solutions commonly include several services such as warehousing picking back or order heading to increasingly third-party logistic providers also provide customized Services integrated in the customer's value chain such as Fleet Management order handling complaints management or assembly Services between their warehouses for parts of the services offers that the 3pl couldn't provide a loan due to a lack of formal assets frequency carriers or Freight forwarders are employed if you look at 4pl refers to Logistics service provider which serves as an Intel material and general contracted for inter-organization supply chain without supplying any physical process by itself so rather it employs carriers three PLS and other logistics service providers for the physical processes and concentrates on planning conceptualizing and managing the supply chain so if therefore is virtually operating without physical assets and therefore supposedly is not true so I can easily say that there are not too many third-party logistic providers in the world mostly we see third-party Logistics service providers and if you see these pyramid the first party Logistics is in the standardized services with owner external resources let's say holy your Warehouse operators in the second party Logistics individual or systemized services with owner external resources let's say International fret forwarders the third party logistic providers Contract Services with owner will build inbuilt resources which we say construct Logistics or lead Logistics provider and finally the four-party logistics Logistics Services tailored me to supply chain needs of the client using best-in-class resources such as independent General contracted uh usually DHL for example uh is kind a third-party Logistics service provider so what are the criteria for selection of Provider first of all the company should you know look at the market and you they should look at the compatibility users of their supply chain and the cost of service of course and the quality of service reputation of the company long-term relationship is very important performance measurement willingness to use Logistics Manpower flexibility in Billing and payments quality of management information sharing and of course and of course Mutual trust these are what these are the criteria that you look when you are selecting your third-party logistic providers but not enough you should also look at look at their operational performance their information technology capability size and quality of fixed assets uh experiencing similar products delivery performance employee satisfaction level Financial type of months and market shares geography spread is important because if you are a global firm you need to look around all geography all places around the world risk management search capacity of providers class for arbitration and Escape flexibility in operations and delivery cost of relationship rate price Financial stability you see a lot of criteria that you need to evaluate you see some GPS in the market today in Turkey for example we see Mars Logistics parcel research but in global Siva initial tuna Nagel Shankar and ankars these are all International trivia I provide you some uh you know website these are professional organizations dedicating to advancing Professional Knowledge for their members I feel a lot luck and look for further information about logistics these websites will help you so I offer these websites too and that's it for tonight's first night it's a heavy material I know but I will try to give the main idea of logistics you'll see all these activities belong to Logistics and Supply Chain management concept is very important in nowadays Logistics cannot be apart from supply chain but Supply Chain management idea is that why do the idea it's a philosophy Logistics activities are included in this supply chain so from now on we will talk separately tomorrow night we will talk start with purchasing and procurement we will talk about demand forecasting and customer service if you have any question you can ask right now but we are out of time now so I can close the class you can send me always an email thank you for listening me see you tomorrow night bye bye thank you Anika for listening me all night goodbye