What is logistics?

Alexey Ganzenko
Alexey Ganzenko
March 18, 2013
What is logistics?

In former times, the concept of "logistics" denoted one of the mathematical industries. What is logistics today? This is a business area whose mission is to meet its immediate needs. The concept was borrowed from the Pentagon’s terminology, where logistics was the direction of supply, support and support for troops.

Logistics in business is designed to meet the needs of consumers, in particular - providing all necessary production, marketing and other activities. As an auxiliary direction, the provision of raw materials is considered. Key characteristics in this case - the availability of goods, continuity and speed of supply, process flexibility. Integrated logistics must take into account the total costs. Thus, supply chains are formed, ensuring the delivery of goods to the consumer on time and at the lowest cost.

The main functional areas of logistics include:

  • logistics infrastructure
  • transportation,
  • cargo handling and warehousing,
  • Inventory Management,
  • Information Support.

The latter is undoubtedly the most important of the entire logistics system. Thanks to information technologies, a set of disparate functional areas was integrated into a system capable of keeping the total supply costs to a minimum.