Logistics is a part of supply chain management involved with meeting customer needs and delivering products and services in the most efficient and accessible way. The supply chain focuses on the bigger picture and strives to enhance the business processes to create competitive advantages for a company.
Logistics addresses activities associated with transportation management in the supply chain. Supply chain management came around in the modern world when the complexity of business processes and interactions became too high. Hence, nowadays business requires both logistics and supply chain administration.
The main function of logistics in supply chain management is primarily to increase the overall value of each delivery, which is identified by customer satisfaction.
This means that the reduction and optimization of labor resources must be tied to keeping up a certain level of quality customer service. This problem is solved both by reducing the total labor resources and by introducing automation solutions.
Transportation costs are one of the largest expense categories in logistics management. They generally increase depending on the distance, batch size, and product exposure to damage.
Supply chain management with the help of logistics tools helps to ensure a consistently high level of customer service with some reduction in the cost of extracting raw materials, storing, transporting, and selling goods/services to end-users.