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Economic Terms
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Section:   en » Economic terms » Logistics      16 января 2015  
Logistics - part of the economic science, the subject of which is to organize the rational process of promoting products and services from suppliers of raw materials to consumers, the functioning of the circulation of products, goods, services, inventory management, product distribution infrastructure.

A broader definition of logistics interprets it as the science of planning, management and control of the movement of material, informational and financial resources in different systems.

From the perspective of the organization's management logistics can be considered as the strategic management of material flows in the process of procurement, supply, transportation, sale and storage of materials, parts and finished inventory (appliances, etc.). The concept also includes the management of the relevant information flows and financial flows. Logistics is aimed at optimizing costs and streamlining the process of production, distribution and related services, both within a single enterprise or a group of enterprises.

Origin of the term

The term first appeared in the Quartermaster Corps of the Armed Forces. The term "logistics" comes from the Greek., Which means "countable art." First used in the treatises on the art of war of the Byzantine Emperor Leo VI (865-912 gg.).

In the Byzantine Empire at the imperial court were "logistics", which is responsible for distribution of food. There is evidence that Napoleon applied in his army logistic principles.

The term logistics introduced in the Russian language at the beginning of the XIX century French military specialist Antoine Jomini.

theory of logistics

Content of logistics as a science is to establish causal relationships and regularities inherent in the movement of goods in order to identify and put into practice effective organizational forms and methods of management of material and information flows.

military Logistics

The clearest manifestation of military logistics was during the Second World War. American military forces, leading the fighting in Europe, is fully guaranteed by the rear units from another continent. Joint and well-established work of military industry, transport (air, sea and land transport) and logistical services provided after the war impetus to the use of military logistics experience in peacetime economy.

Nowadays, the concept of "military logistics" in some countries still remains, but in Russian the term "logistics" now associated primarily with the business.

Business Logistics

Depending on the specifics of the company are different logistics systems. Logistics system - a set of actions of participants of the logistics chain (enterprise-producers, transport, trade organizations, shops, etc.), Built in such a way that the main problem of logistics.

Logistics systems are very diverse in scope of the company (and understanding of modern Russian management). For some it's just a logistics ability to work with databases, for some - Resupply or warehousing activities. But according to the destination (and most importantly its purpose - to reduce costs, subject to the targets, and hence an increase in production efficiency) logistics system should cover almost all (except for accounting, human resources, and so on. N.) Activities. [Citation needed 914 days] Universally recognized logistics systems and management concepts are given below. Just In Time: MRP - Materials requirements planning, DRP (distribution requirements planning), MRPII - Manufacturing resource planning, ERP - Enterprise resource planning; LEAN PRODUCTION: CSRP - Customer Synchronized Resource Planning, ROP, QR, CR, AR; EOQ model; The system of two levels; Two hopper scheme; Model with constant periodicity of the order; ABC method; Non-stationary and stochastic models of inventory management and others. Companies can develop their own logistics departments, and may involve transportation and logistics organizations to address issues of supply, warehousing and logistics. Depending on the level of involvement of independent companies to solve business problems in logistics distinguish different levels: 1PL - from the English. «First-party logistics» - an approach in which the organization decides to logistical issues on their own; 3PL from the English. «Third-party logistics» - an approach in which a full range of logistics services from the delivery address storage to order management and tracking the movement of goods is transferred to the side of the transport and logistics organization. The functions of the 3PL-provider include the organization and management of transportation, accounting and inventory management, preparation of import and export documentation and freight, warehousing, cargo handling and delivery to the end user.

The task of logistics management in practice comes down to managing multiple components that make up the so-called «logistics mix»:
- Storage facilities (separate storage buildings, distribution centers, warehouses, combined with a shop);
- Reserves (the reserves under each name, the location of the reserve);
- Transportation (modes of transport, timing, types of packaging, the presence of the drivers, and so on. D.);
- Picking and packing (simplicity and ease in terms of logistics services while maintaining influence on the buying activity);
- Communication (the possibility of obtaining the ultimate and intermediate information during the movement of goods).

Logistics is divided into types: procurement, transport, storage, manufacturing, logistics and other information.

Procurement Logistics

The main objective of procurement logistics is to meet the production of materials with maximum cost-effectiveness, quality and shortest time. Procurement Logistics runs the search and selection of alternative suppliers of manufacturers. The main methods are traditional procurement logistics and operational methods. The traditional method is carried out by supplying the required quantity of goods at a time, and operating as required in the product. An important part of purchasing logistics planning is based on the supply of inventory management.

distribution Logistics

This is a set of interrelated functions implemented in the distribution of material flow between different wholesalers.

Retail Logistics

Sales Logistics (logistics distribution) - an area of research of system integration functions realized in the distribution of material and attendant (informational, financial and service) flows between different users, that is in the process of sale of goods, whose main objective - ensuring the delivery of the right products in the right place at the right time with the optimal cost. With the concept of logistics distribution is closely related to the concept of distribution channel - a set of different organizations, which deliver the goods to the consumer.

Transportation logistics

Transport logistics is a system for organizing the delivery, namely the displacement of any material objects, substances, etc. From one point to another on the optimal route.
More detailed features of the logistics are:
1. staff who is engaged in the implementation of these tasks (porters, drivers)
2. The classification of vehicles (in terms of volume m3)
3. The pricing policy (labor, for fuel, transport services).

Logistics stocks

Inventory control policy consists of decisions - what to buy or make, when and in what amounts. It also includes the decision on the placement of stocks in manufacturing plants and distribution centers.

The second element concerns the policy of inventory management strategy. You can manage the stock of each distribution warehouse separately and can be centrally (requires greater coordination and information management)

Logistics stocks

Inventory Management Enterprise - an integrated process that ensures operation with reserves within the company and outside of it - throughout the supply chain management.

Inventory control policy must necessarily rely on the strategy of the enterprise as a whole. It depends on the strategy choice model of inventory control.

"Reactive" model, in other words, the model of "pull", which allows to build inventory management based on demand or a specific order from the manufacturer to the end user. Planned model assumes promotion of a product within the marketing channel of distribution according to a specific schedule in accordance with the forecast of demand for the product and its presence in the market. Particularly relevant mixed governance model that combines management methods of the previous models and allows you to quickly and efficiently adapt to changes in the market.

Inventory Control - technical means of policy implementation, and inventory management. The treatment consists of keeping inventory control inventory availability, regular monitoring of parishes / expenses. These operations can be carried out particularly effectively by using the manual control of automated systems without the use of information systems. The use of information systems ERP-class is now an integral part of the control system of production and inventory of the enterprise.

Warehouse logistics

The main objective is to optimize warehouse logistics business processes of acceptance, processing, storage and shipment of goods in warehouses. Warehouse logistics determines the rules of the organization of storage facilities, procedures, work with the product and the corresponding processes for managing resources (human, technical, informational). It uses the most common methods of FIFO, LIFO, FEFO, FPFO, BBD. For information and technical support such processes, specialized warehouse management system WMS.

Information logistics

A set of actions for the effective distribution of information flows between digital and traditional media.

Integrated Logistics

Systematic approach to the life cycle of the goods and related activities in the period from the date of manufacture of its components to the moment of consumption. This is an effective system of management of material, information and financial flows related to the lifecycle of the product. An integrated approach to logistics processes can reduce or neutralize the risks of uncertainty, which is under the influence of the functional life cycle of the product.

Environmental Logistics

Environmental Logistics provides material flow in all production processes up to its transformation into marketable products and waste, followed by waste to recycling or safe storage environment. Environmental Logistics also provides for the collection and sorting of waste resulting from the consumption of commodity products, transportation, recycling or safe storage environment. It allows you to radically clean large areas contaminated with unauthorized waste.

Lean Logistics

Synthesis of logistics and Lin concept will create a pull system, which combines all the firms and companies involved in the value stream, in which there is a partial replenishment of small batches. Lin technology principles apply to the scope of logistics, warehouse management, inventory and transport within the enterprise, and then to control external to the plants flows. Lean Logistics uses the principle of total logistics cost, Total Logistics Cost, TLC, which allows:
Reduce inventory throughout the supply chain;
Reduce the cost of transportation and storage;
Establish logistic cooperation.

City Logistics

Logistics City (City Logistics, Municipal Logistics) - complex logistics decisions, actions, processes aimed at optimizing the management decisions of the administration, flow of materials, vehicles, people, knowledge, energy, finance, information subsystems within the city and its infrastructure.

Other applications

In recent years there has been a tendency to apply the principles of logistics, not only in economics and finance, but also in the social field (social logistics): politics (political Logistics), municipalities (municipal logistics), pedagogy (teaching or educational logistics), psychology (educational psychologized Logistics ), medicine (medical logistics), Pharmacy (pharmaceutical logistics), and demographic demography logistics); Virtual Logistics and others.

Problems to be Solved logistics:

- Select the type of vehicle;
- Determination of routes;
- Organization of cargo transportation;
- The packaging of goods in containers;
- Inventory management;
- Safekeeping in storage areas;
- Labeling;
- The formation of teams of orders;
- Customs services
and others.
See also:

  • Strategic Management
  • Innovation
  • Management
  • Foreign Economic Activity
  • Audit

  • Banks

    International Monetary Fund

    Wall Street

    Bank of America

    JP Morgan Chase

    Wells Fargo


    Goldman Sachs

    Morgan Stanley



    BNP Paribas

    Credit Agricole


    Credit Suisse

    Royal Bank of Scotland (RBS)

    Deutsche Bank

    Sberbank of Russia


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