1. SUPPLY CHAIN:
LOGISTIC & DISTRIBUTION IN
CONTEXT
PREPARED BY: SHAHBANI EMAIL: shahbani2004@gmail.com

2. Logistics and Supply Chains
What is Logistics
The total management of the key operational
functions in the
supply chain – procurement, production and
distribution.
Procurement includes purchasing and product
development. The production function includes
manufacturing and assembling,
while the distribution function involves warehousing,
inventory, transport and delivery.

3. Logistics and Supply Chains
Logistics : Range of Activities Involved
• Freight fowarding
• Customs brokerage
• Freight auditing and payment
• Vehicle control and
communications
• Product identifications &
tracking
• Information systems –
optimisation in management

4. Logistics and Supply Chains
Logistics : Range of Activities Involved
• Transportation services / Brokerage
• Transportation equipment / leasing
• Private fleet assets / management
• Warehousing
• Order Management & fulfillment
• Cross docking
• Value added, assembly & configuration
• Site location

5. Logistics and Supply Chains
Materials Management
is the planning, organisation and control of all aspects
of inventory embracing procurement, warehousing, work
in progress and distribution of finished goods.

6. Logistics and Supply Chains

7. Logistics and Supply Chains
Logistics : Transport Principles
• Economies of scale : Large capacity transportation
vehicle are less costly per unit of freight than smaller
capacity vehicle.
• Economy of distance : Decrease transportation coast
per unit of weight as distance increase. To maximise the
size of load and the distance being shipped while still
meeting the customer expectation,

8. Logistics and Supply Chains
Logistics :Transport Mode
• Small Packages
• Air Cargo
• Truckload
• Railroad/ Train
• Water
• Pipe Line
• Intermodal (Combination)

9. Logistics and Supply Chains
Logistics :Transportation
Management
• On-time pick up
• On-time delivery
• Loss & damage claims
• Transit time
• Transit time reliability
• Equipment availability
• Price
• Continuous improvement

10. Logistics and Supply Chains
Economic Driver
Distance
Market Weight
Factors
Liability Density
Handling Stowability

11. Logistics and Supply Chains
Reverse Logistics
is the process of planning, implementation and controlling
the efficient, cost effective flow of raw materials, in process
inventory, finished goods and related information from the
point of consumption to the point of origin for the purpose
of recapturing value or proper disposal.

12. Logistics and Supply Chains
A Supply Chain is that network of organisations that are involved,
through upstream and downstream linkages, in the different processes
and activities that produce value in the form of products and services
in the hands of the ultimate customer or consumer.
Types of Supply Chain
Can be classified according to:
• Customer/supplier characteristics
• Virtuality
• Scope
• Service
• Complexity
• Products
• Purpose and value

13. Logistics and Supply Chains

14. Logistics and Supply Chains

15. Logistics and Supply Chains

16. Logistics and Supply Chains

17. Logistics and Supply Chains
Customer
relationship
management
Returns Customer service
management management
Product development Supply Chain Management
Demand management
& commercialisation – Eight Processes
Supplier relationship Order
management fulfillment
Manufacturing flow
management

18. Logistics and Supply Chains
Supply Chain Vulnerability
Cranfield Five Categories of Supply Chain Risk!
Lack of Decision Inertia
J.I.T
Ownership Chaos Risks Risks
Relationship
Risks
Risks

19. Logistics and Supply Chains
Ten ways of Managing Supply Chain Risk
1 Diversification
2 Stockpiling
3 Redundancy
4 Insurance
5 Supplier selection
6 Supplier development
7 Contractual obligation
8 Collaborative initiatives
9 Rationalisation of the product range
10 Localised sourcing

20. Logistics and Supply Chains
Porter’s Value Chain Model
Five Primary Activities
• Inbound logistics
• Operations
• Outbound logistics
• Marketing and sales
• Service

21. Logistics and Supply Chains
Porter’s Value Chain Model
Four Support Activities • Firm infrastructure
• Human resources
• Technology development
• Procurement

22. Logistics and Supply Chains
Ten Major Cost Drivers – Value Chains
1 Economic or diseconomies of scale
2 Learning and spillovers
3 Capacity utilisation
4 Linkages among activities
5 Inter-relationships
6 Degree of vertical integration
7 Timing of market entry
8 Firms policy of cost or differentiation
9 Geographic location
10 Institutional factors

23. Logistics and Supply Chains
Test the cost reduction
strategy for sustainability
Main Steps in
Ensure cost reduction
Strategic Cost Analysis
efforts do not differentiate
Develop a strategy lower
relative cost position
Identify competitor
value chains
Diagnose the cost
drivers of each activity
Identify value chain &
assign costs & assets to it

24. Logistics and Supply Chains
Supply Chains – Who Runs Them?
45% Logistics or supply manager
20% Operations or production director
15% Logistics or supply director
14% Operations or production manager
Sale, finance or commercial