What Is Logistics?

Logistics is originally a term in the military that referred to the movement of supplies and equipment to the troops. This required managing a lot of moving parts that need to be tracked. These days, logistics refers to the part of a business or an organization that is responsible for handling and moving resources through the supply chain. In other words, make sure that things get from point A to point B as efficiently as possible.

What Is Logistics?

But what exactly is logistics? Logistics is used more broadly today as it means the process of coordinating and moving resources, whether it be people, inventory management, materials, and equipment, from one place to another. It is a component of the supply chain that is used to meet customer demand. Logistics management systems help organizations reduce expenses and enhance customer service by delivering goods and people on time.

Logistics vs. Supply Chain Management

Logistics management and supply chain management are closely related, so it’s not surprising that people often get confused and use the terms interchangeably.

Logistics Management is the coordination and moving of resources and is part of the supply chain. Logistics management handles the daily operations that get the final product into the hands of consumers. The main goal for suppliers is to allocate the right resources at the right time and ensure that they get to the correct location on time.

The supply chain is the bigger network of businesses and organizations that work together to deliver products to consumers. Logistics is a part of the supply chain, while the supply chain is much bigger and includes the entire process of product production from beginning to end.

Role of a Fleet Manager as a Logistics Expert

Logistics fleet managers are responsible for choosing the right vehicles and keeping them in good working order to meet their distribution goals cost-effectively and efficiently. Fleet management software is often used to make this process easier, more efficient, and more cost-effective for the business.

Components of Logistics

These days, logistics is a complex process that companies need to manage their supply chain. It often involves a network of transportation that includes many types of vehicles. Here are some of the major components of logistics that ensure the efficient movement of goods and people.

Acquisition of Vehicles

The logistics fleet manager is tasked with deciding what types of vehicles to purchase when to purchase them, and the best way to finance them. Depending on the size of the fleet, they may choose to buy them outright or decide to lease them. They often use fleet logistic tracking software, such as MiX by Powerfleet, to help them determine when to replace a vehicle and whether they should purchase a similar one or not.

Record Keeping for Fleet Vehicles

Keeping records of the registration, and licensing, and ensuring they are up to date is a key component of logistics fleet management. The fleet logistics manager also maintains vehicle inspection and service records so that the fleet stays in compliance with the manufacturer’s service schedules or if they are leased, with the leasing company’s requirements. They must also keep records of regulatory compliance. This information can be stored and easily accessed in transport fleet management software.

Schedule Preventive Maintenance

An optimized and well-maintained vehicle runs more efficiently and has a longer useful life. To ensure fleet vehicles are regularly maintained and optimized, logistics fleet managers set up maintenance schedules for their vehicles. To minimize downtime, fleet managers follow strict servicing schedules so that their vehicles run well and longer. This also helps control costs because they will have greater fuel efficiency. Fleet management software can automate this scheduling and alert the fleet logistics manager about when maintenance is needed.

Track Driver Behavior

Aggressive and risky driver behavior can have an effect on fleet fuel usage and vehicle maintenance costs. Logistics fleet managers are increasingly using systems such as MiX by Powerfleet to monitor driver behavior, such as speeding, erratic driving, and excessive braking. They also use GPS logistics fleet tracking systems to track vehicles and improve traceability should a vehicle be stolen. GPS systems for fleet management and logistics let managers monitor vehicle progress and take corrective action in real-time to reduce delays to scheduled deliveries.

Cost Control

Logistics fleet managers often use fleet management and logistics software to automate tasks such as recording and collecting the information that lets them keep track of vehicle performance, driver behavior, and their related costs. Fleet managers can access and analyze the information to find patterns and use this information to take actions that reduce costs. The software also lowers administrative costs by automating drivers’ timesheets and the records needed for regulatory compliance.

Benefits and Importance of Logistics

Organized, seamless logistics is essential for keeping pace with customer demands and outperforming their competition. No matter the current size of a business, its goal is to grow and expand. Logistics can help reduce the costs and time spent moving products from one point to another.

Since they depend on ever-changing customer demand, supply chains can be complex and sensitive. Organized transport is the key to supply chain success, and that means logistics. When transport is done right, it seems simple and effortless. In reality, it requires specialized knowledge, skills, and know-how to make it look so easy.

Efficient transport improves the supply chain by decreasing the waste of time and materials. This helps transport products and deliver them promptly to the right location, which is key to any business.

Effective Logistics Leads to Positive Business Results

As businesses meet their goals of growing and expanding, they rely on supply chains that, in turn, count on sophisticated logistics to work effectively. This element of a supply chain matters to any size business, not just a large one. It is just as important to improve efficiency and profitability, no matter how small or large the fleet is.

Logistics plays a key role in supply chain management. Fleet logistics managers use logistics to plan and coordinate the products movement schedule so that they can be moved safely and effectively.

These days, customers are not just your friends and neighbors, but also people all over the world. No matter the distance, customers expect their products to be delivered on time. In order to make this happen, logistics fleet managers are increasingly turning to GPS tracking and telematics solutions.

Logistics Helps Businesses Create Value

A business’ value can be measured not only in quantity or quality but in availability. Logistics plays a crucial role in making products available to a larger group of people. Business leaders are increasingly considering logistics as a vital tool for creating value for their customers.

Logistics Helps Keep Deliveries on Time

Although logistics is clearly defined as a part of the supply chain, it continuously evolves to match different customer demands. And increasingly, customers nowadays are more likely to make impulse purchases on their mobile phones and impatiently wait to receive their orders. Efficient and flexible logistics systems allow businesses to meet these package delivery requirements.

Logistics Helps Improve Efficiency and Reduce Costs

With the rise in global trade and eCommerce, logistics has become an even more vital part of the supply chain. In some cases, businesses have begun to outsource transport and distribution or are choosing to automate some of their logistics fleet management tasks. In the long run, this can improve efficiency and reduce costs, resulting in a stronger brand with a better reputation.

Logistics Powers the Supply Chain

Although the supply chain is the entire network, it is logistics that keep the network going. The supply chain network includes production, warehousing, shipment, and delivery. These networks are important, but without efficient logistics, the supply chain can’t fulfill its roles, and businesses suffer. Reliable and efficient logistics is the key to keeping the supply chain operating.

Logistics in Transport and Distribution

Transport and distribution bridge the gap between producers and consumers and is a driving force for economic development. Many businesses outsource the transport and distribution of their products to ensure the logistics of this part of the supply chain are handled efficiently. This gives businesses more time to grow their core business without having to worry about managing a fleet to keep deliveries on time. It also gives them increased flexibility to upscale or downscale based on consumer demand or the seasonality of products.

Transport and distribution are the last steps in getting products from carriers to consumers, and efficient logistics is key in this area. With an updated logistics fleet management solution from MiX by Powerfleet, these fleets can run more efficiently with fewer errors and increased on-time deliveries. By planning better routes and monitoring driver behavior, transport fleets can save supply chain partners time and money.

Additional Industries That Benefit from Logistics

There are some industries where the benefits of logistics and logistic software are obvious. However, there are other industries that can benefit from cost-effective fleet logistics tracking. MiX by Powerfleet offers fleet logistics tracking suitable for industries outside of transport and distribution, such as:

• Mining
• Oil and Gas
• Emergency Services
• Public Transport
• Security
• Rental and Leasing
• Public Transportation
• Government
• Telecom
• Fast Moving Consumer Goods

Even small to medium businesses that don’t deliver goods can benefit from fleet logistics management software. They still need to schedule tasks, jobs, and journeys; reduce risky and aggressive driving behaviors, lower gas and maintenance costs, and comply with the regulations of their industry. MiX by Powerfleet offers flexible solutions to small to medium businesses that benefit from logistics including:

• Construction
• HVAC
• Landscaping
• Utilities
• Food Delivery
• Pest Control

If you want to boost the logistics of your fleet, no matter the size or industry, contact us to discuss the best solution for your business.