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How logistics management can help your business

In every industry dealing with physical products, from retail stores to e-commerce businesses, managing logistics is vital. Improving logistics management can help decrease overhead, improve visibility, prevent product loss, boost customer service and offer better business opportunities. 

But what is logistics management, and how can it help your business succeed? Learn more about logistics management, including five ways a solid logistics plan can help improve your business. 

And when you’re finished, check out the other articles in our ‘Logistics management software’ series:

What is logistics management?

Logistics refers to all the steps a business must take to have its products reach the end customer. From supply to distribution, logistics covers everything related to the physical movement of goods and storage. Management of these activities, referred to as logistics management, is essential to a successful business.

To effectively manage and optimize your business’s logistics activities, you should keep the “7 Rs of logistics” in mind. This entails getting the:

  • Right product, in the 
  • Right quantity, in the 
  • Right condition, at the 
  • Right place, at the 
  • Right time, to the 
  • Right customer, at the 
  • Right price

The Rs of logistics management focus on planning, implementing and controlling the movement and storage of your products so you can sell them to customers. By optimizing this process, you can build better customer relationships, earn more revenue and minimize logistics costs.

How does logistics management work?  

Logistics management is the process of moving goods from point A to point B. But this journey includes several components:

  • Sourcing: Companies find products or materials through suppliers. In strategic sourcing, managers source from suppliers that offer the best price and reliable shipping options. 
  • Transportation: Physically moving goods is the main component of managing logistics. Companies use logistics strategies to choose carriers that offer the best price and shipping speed based on optimized routes, distance and customs regulations. 
  • Order fulfillment: When a customer places an order, it’s picked from the warehouse, packaged, labeled and shipped. Logistics management carefully monitors and optimizes these processes to ensure speed and accuracy.
  • Warehousing: Having products available to ship to customers is another essential aspect of managing logistics. These products must be stored cost-effectively and securely to prevent wasted space or spoilage. 
  • Demand forecasting: Logistics management technologies and strategies that predict when customers want a certain product are essential. A business should always aim to keep the right inventory on hand to meet customer demand while minimizing overhead storage costs.
  • Inventory management:  Effective inventory management goes hand-in-hand with demand forecasting. But instead of predicting future demand, inventory management aims to optimize products already on hand. For example, if a product is underperforming in one location, a smart inventory management strategy might suggest moving the products to a location where they will sell. 
  • Supply chain management: Logistics management is just one aspect of wider supply chain management. While it focuses on just one business’s activities, it’s important to understand how the movement of goods from suppliers to sellers to buyers works on a global scale.

5 ways logistics management can help your business

Are you thinking of optimizing your logistics management strategy? With well-balanced and intentional management of your logistics activities, you can help your business in these five ways. 

Decreased overhead

Shipping and warehousing costs can add up quickly. A lean logistics strategy can reduce these overhead costs and save your business money. For example, you can reduce warehouse costs with demand management, a logistics management strategy. Demand planning allows managers to forecast what products customers will want and when, allowing them to reduce backstock and minimize costly warehouse space.

Higher visibility

Logistics tracking is another essential aspect of managing logistics. With technology-based solutions that track logistics operations, managers gain better visibility into their supply chains and overall operations. Knowledge is power, and through logistics tracking, businesses can better spot supply chain inefficiencies, manage costs and identify new opportunities. 

Loss prevention

Effectively managing physical inventory is vital for preventing lost or damaged products that eat into your bottom line. With logistics management technologies, you can track the exact location of your stock to prevent theft or misplacement. You can also monitor transportation and storage conditions to prevent temperature- and moisture-related damage. 

Better customer service

Today’s customers expect on-time deliveries and transparency throughout the shipping process. A strong logistics management strategy helps companies build these customer relationships based on trust through consistently accurate and timely deliveries. When customers know they can rely on your business to deliver on promises, you can boost repeat orders and your brand’s reputation. 

More business opportunities

Smart and scalable logistics management strategies can help you grow your business. For instance, you can anticipate future inventory needs through realistic demand forecasting to ensure you have the right stock to fulfill orders. It also provides decision-makers with key insights that can lead to innovative business solutions.

Optimize your business with logistics management

No matter what you sell, having a solid logistics management strategy can help you maximize your business’s potential. While vital logistics activities such as shipping and warehousing may not be the most glamorous aspect of running a retail company, the power of logistics lies in the details. Because getting your product to the right customer at precisely the right time is essential for competing in today’s global marketplace.


What do logistics managers do?

Logistics managers plan, coordinate, and oversee the transportation, storage, and distribution of goods and materials. They are responsible for ensuring that products and supplies move efficiently from one point to another, while minimizing costs and maximizing productivity.

What is an example of logistics in real life?

An example of logistics in real life is the process of planning and executing the delivery of online orders from a retailer to customers’ homes. It involves coordinating the storage of products, packaging the orders, selecting the appropriate shipping methods, and managing the transportation networks to ensure timely and accurate delivery.

How do logistics improve the economy?

Logistics is essential to the global supply chain, ensuring products reach their end customer. Logistics helps the economy grow by facilitating sales in every industry, and promoting transport infrastructure investments that benefit society in general. 

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