Successfully reported this slideshow.
We use your LinkedIn profile and activity data to personalize ads and to show you more relevant ads. You can change your ad preferences anytime.
What is Logistics?
Jesse Uitto
jesseuitto.fi
How is value added in manufacturing
Stored raw
materials
Payment
time for
purchasing
debt
Buy stuff and
get payment
time
How is value added in manufacturing
Stored raw
materials
Manufacturing
Finalized
products in
stock
WIP
Payment
time for
pu...
How is value added in manufacturing
Stored raw
materials
Manufacturing
Finalized
products in
stock
WIP Sales
payment
time
...
How is value added in manufacturing
Stored raw
materials
Manufacturing
Finalized
products in
stock
WIP Sales
payment
time
...
So what does logistics has to do with this?
So what does logistics has to do with this?
• Negotiate longer payment time for purchasing
debt and shorter payment time f...
So what does logistics has to do with this?
• Negotiate longer payment time for purchasing
debt and shorter payment time f...
Optimize finances
Optimize finances
Stored raw
materials
Payment time for purchasing debt
Negotiate long payment time for purchases
Optimize finances
Stored raw
materials
Manufacturing
Finalized
products in
stock
WIP Cash
sale
Margin
Payment time for pur...
Optimize finances
Stored raw
materials
Manufacturing
Finalized
products in
stock
WIP Cash
sale
Margin
Payment time for pur...
Optimize material flow
Optimize material flow
Stored
raw
materi
als
Payment time for purchasing debt
Try to
minimize
raw
material
storage.
Also
n...
Optimize material flow
Stored
raw
materi
als
Manufacturing
WIP
Payment time for purchasing debt
Try to
minimize
raw
materi...
Optimize material flow
Stored
raw
materi
als
Manufacturing
Finalized
products
in stock
WIP
Payment time for purchasing deb...
Optimize material flow
Stored
raw
materi
als
Manufacturing
Finalized
products
in stock
WIP Cash
sale
Margin
Payment time f...
Optimize material flow
Stored
raw
materi
als
Manufacturing
Finalized
products
in stock
WIP Cash
sale
Margin
Payment time f...
Summarization
• Although some companies do negotiate long
payment times for their debts it is not always
reasonable to use...
Summarization
• Although some companies do negotiate long
payment times for their debts it is not always
reasonable to use...
Thank You
• This presentation showed some basic ideas
about logistics. Read more about how to use
them in practice from je...
Upcoming SlideShare
Loading in …5
×

What is Logistics

1,000 views

Published on

Short summary about Logistics. What it is and how does it affect on your business.

Published in: Economy & Finance
  • Be the first to comment

  • Be the first to like this

What is Logistics

  1. 1. What is Logistics? Jesse Uitto jesseuitto.fi
  2. 2. How is value added in manufacturing Stored raw materials Payment time for purchasing debt Buy stuff and get payment time
  3. 3. How is value added in manufacturing Stored raw materials Manufacturing Finalized products in stock WIP Payment time for purchasing debt Buy stuff and get payment time Add value trough processing
  4. 4. How is value added in manufacturing Stored raw materials Manufacturing Finalized products in stock WIP Sales payment time Margin Payment time for purchasing debt Buy stuff and get payment time Add value trough processing Add margin and sell your stuff with payment time
  5. 5. How is value added in manufacturing Stored raw materials Manufacturing Finalized products in stock WIP Sales payment time Margin Payment time for purchasing debt Tied up working capital Buy stuff and get payment time Add value trough processing Add margin and sell your stuff with payment time You have tied up working capital from the moment you pay debts until the moment you have money from sales
  6. 6. So what does logistics has to do with this?
  7. 7. So what does logistics has to do with this? • Negotiate longer payment time for purchasing debt and shorter payment time for sales – Optimum would be if you had money from sales before you have to pay your purchasing debt!
  8. 8. So what does logistics has to do with this? • Negotiate longer payment time for purchasing debt and shorter payment time for sales – Optimum would be if you had money from sales before you have to pay your purchasing debt! • Optimize storage time for both raw materials and finalized products – Less working capital
  9. 9. Optimize finances
  10. 10. Optimize finances Stored raw materials Payment time for purchasing debt Negotiate long payment time for purchases
  11. 11. Optimize finances Stored raw materials Manufacturing Finalized products in stock WIP Cash sale Margin Payment time for purchasing debt Negotiate long payment time for purchases Sell stuff with cash, advance payment or with very short payment time
  12. 12. Optimize finances Stored raw materials Manufacturing Finalized products in stock WIP Cash sale Margin Payment time for purchasing debt Negative working capitalNegotiate long payment time for purchases Sell stuff with cash, advance payment or with very short payment time You need very little or no working capital
  13. 13. Optimize material flow
  14. 14. Optimize material flow Stored raw materi als Payment time for purchasing debt Try to minimize raw material storage. Also negotiate lower prices.
  15. 15. Optimize material flow Stored raw materi als Manufacturing WIP Payment time for purchasing debt Try to minimize raw material storage. Also negotiate lower prices Try to minimize Cycle Time
  16. 16. Optimize material flow Stored raw materi als Manufacturing Finalized products in stock WIP Payment time for purchasing debt Try to minimize raw material storage. Also negotiate lower prices Try to minimize Cycle Time Minimize end product storage
  17. 17. Optimize material flow Stored raw materi als Manufacturing Finalized products in stock WIP Cash sale Margin Payment time for purchasing debt Try to minimize raw material storage. Also negotiate lower prices Try to minimize Cycle Time Minimize end product storage Again cash is the king
  18. 18. Optimize material flow Stored raw materi als Manufacturing Finalized products in stock WIP Cash sale Margin Payment time for purchasing debt Negative working capital Try to minimize raw material storage. Also negotiate lower prices Try to minimize Cycle Time Minimize end product storage Again cash is the king Due to shorter storage times we now have even more negative working capital
  19. 19. Summarization • Although some companies do negotiate long payment times for their debts it is not always reasonable to use your suppliers as an bank – Instead try to build working cooperation with your suppliers
  20. 20. Summarization • Although some companies do negotiate long payment times for their debts it is not always reasonable to use your suppliers as an bank – Instead try to build working cooperation with your suppliers • Best ways to decrease working capital is to manage storages and decrease cycle time and WIP
  21. 21. Thank You • This presentation showed some basic ideas about logistics. Read more about how to use them in practice from jesseuitto.fi

×