Logistics and Distribution includes a variety of functions. All of this is focused on achieving efficient distribution and delivery of finished products. This takes stock from the end of the production line to reach consumers.
Also, it offers a comprehensive set of methods and tools to use. All of this applies to three key areas including asset management, order fulfillment, and logistics management.
What’s the Difference between Logistics and Distribution?
Moreover, some people may view them as similar. In addition to consulting a dictionary, both Logistics and Distribution suggest a picture that affects the movement of goods.
But for anyone working in the Supply Chain, especially on a topic including Logistics or Distribution, or if you work for a Distribution Center or a Logistics business, then there is a separate difference among these terms.
But are there also commonalities?
Let’s start by looking at the common definitions used for each Modification and Distribution.
According to Wikipedia, “Logistics is the management of the flow of information between a traditional point and the point of sale to meet the needs of customers or companies. The logistics of physical items often involves the integration of information flow, inventory management, production, packaging, transportation, storage, and security.
Techopedia defines Logistics as, “Logistics management is part of supply chain management which is used to meet the needs of customers by planning, managing, and performing the function of moving and storing related information, goods and services from where they go. The logistics management process starts with the accumulation of raw material in the final stage of delivery. ”
Finally, let us consider the definition of CSCMP: “Logistics management is part of the supply chain management that organizes, operates, and manages the efficient, effective, and flexible flow of goods and services, services and information related between traditional point and use point to meet customer needs.
Logistics management functions usually comprise inbound and outbound transport management, shipping management, order fulfillment, inventory network construction, and inventory management, procurement/demand planning, and outsourcing service provider management. ”
The term Distribution has many different meanings other than those associated with Supply Chain Management so that we limit these definitions only by our context.
Investopedia defines Distribution as “Distribution Management means overseeing the movement of goods from a supplier or manufacturer to a point of sale. Distribution management is a descriptive term that means many tasks and processes such as packaging, inventory, storage, procurement, and asset performance. ”
CSCMP defines distribution as “activities associated with the movement from source to location. It may be associated with movement from the manufacturer or distributor to customers, vendors, or other secondary storage/distribution facilities. ”
BusinessDictionary.com also defines distribution as “The movement of goods and services from a source through a distribution channel, to the end customer, buyer, or user, and the payment flow on the opposite side, to the actual manufacturer or supplier.”
Comparing Logistics and Distribution
To be honest I had my own preconceived notions of what Logistics is and what Distribution is.
When I think of Logistics I think of Freight management, Transportation, carriers, and complete planning and delivery management until the end of the Supply Chain. The nodes in Logistics include providers, distribution channels, management service providers, and customers.
When I think of Distribution I think of distribution centers, the receipt of goods from suppliers, the storage and internal management of goods, the fulfillment of customer orders and channels, the replenishment of goods in those channels, and customer return management.
In short, I would consider Distribution as a small collection of Logistics.
But if you look at the definitions we have given here, from reputable sources. It is actually very difficult to see any difference between the two terms.
The terms and ideas for planning, logistics, inventory management, warehousing, and so on, are similar to the definition of Logistics and Distribution.
Order Fulfillment – Logistics and Distribution
Distribution logistics helps businesses reorganize their customer organization and processes. At the same time, it handles customer inquiries and orders. This will ensure that medium or close customer service organizations are aligned with their company’s goals.
Some of the factors included in business objectives market expectations, operational objectives, and business strategy. From taking orders to shipping, it also focuses on the following.
- Time management process
- Transaction efficiency
- Transaction reliability
- Internal and internal communication of information in a timely and accurate manner
Another area of expertise in distribution equipment is warehouse management. This includes focusing on tracking systems, communication between product channels, and warehouse infrastructure. It also deals with the storage and acquisition of goods in various locations. These include outbound distribution management centers, inbound deposits, and cross-border restrictions.
It also focuses on providing value-added services and in-house delivery. These include repair, simple production processes, and sequencing. Resources used for the endless search for continuous improvement. Ultimately it will lead to a reduction in space requirements, a reduction in facility cost, and the stability of the general procurement supply. Services also develop through a culture of excellence.
The concept of a well-organized warehouse will provide several benefits. It will increase staff efficiency and increase login time. Equipment handling will also upgrade. This will also help customers define their warehouse organization and include the necessary information systems and physical support.
Distribution logistics also brings procedures and ethics to the management of transportation. This is usually done using an effective partner carrier database. It also empowers companies to create the right mobility for their business.
In the case of transport management, the management of outputs, and inputs are given priority. This ensures that clients will benefit from the stability, visibility, and control of their costs and services.
Transport management also focuses on key management systems. At the same time, it deals with transportation network design with a limited flow of transport needs. Its relentless focus on continuous upgrading will eventually result in higher service quality, transportation, and overall cost reduction.