Everything you need to know about how a logistics operation works
Efficient resources and times are some of the most critical priorities for the organizations; the logistics operation acquires an intrinsic value since it turns out to be the key to optimizing organizational processes in the short and long term. Keep reading and discover everything that a logistics operation can do for your company.
What is it?
A logistics operation consists of activities directly related to the transformation of raw materials into final products or the flow of information. A company that wants to achieve objectives on time depends on a correct logistics operation to streamline resources, processes, and times.
This process can be carried out internally, but it is suggested to have an external operator, depending on the complexity of the supply chains and capabilities of the company in question.
How does it work?
A logistics operation requires attention at specific moments in the supply chain, among which the following stand out:
- Order processing. It is the set of actions related to the reception, processing, verification, and preparation of purchase orders.
- Materials management. They are the procedures that are carried out to organize the products in the warehouses or from the warehouse to the points of sale.
- Transportation of products. It is the definition of the means of transport of the merchandise to the end-user. This implies certain factors such as that the products are properly preserved and the choice of the best delivery route, which must be efficient in time and resources.
- Product storage. It consists of selecting the products to store them correctly, depending on their size and characteristics.
- Inventory control. It involves total control of the number of products delivered to the customer, depending on demand.
What types of logistics operators are there?
Logistics operators are classified according to the area they are in charge of executing; they are called Party Logistics (PL):
- Transportation (1PL). It encompasses the agencies or organizations in charge of the logistics and transport of the final products of their clients, that is, of the collection and distribution of the companies’ merchandise. In this way, the company does not buy fleets or personnel to carry out this fundamental task of its daily operation.
- Transportation and storage (2PL). In addition to transportation, these organizations deal with the storage of products, which is a more complex job than just transporting merchandise.
- Transportation, storage and organization of operations (3PL). It encompasses the logistics of transport and storage inside and outside the companies, which entails greater responsibility in the supply chain for agencies or organizations that must become familiar with the company’s needs and its customers.
- Coordination and supervision of logistics (4PL). When the logistics operator acts as supervisor and operation of logistics, that is, the company leaves the flow and coordination of its supply chain in charge of a third party.
- Supervision and execution of all logistics operations (5PL). This type of operator is in charge of transport and storage logistics inside and outside the companies. The optimization, administration, and execution of their supply chain; In this way, the company is only responsible for its business growth, leaving the logistics in the hands of a third party.
Advantages of having a logistics operator.
A logistics operator can offer significant benefits depending on its services, but the cost and resource savings, as well as the optimization of inventories and quality of services, are the immediate advantages that a company can achieve.
If you have convinced yourself and want to have the best ally to optimize your processes, we are ready to help you at Woodward Logistics fully. More than 80 years have allowed us to forge a solid infrastructure in logistics, transport, cargo, and warehouses, as well as a vast experience and knowledge that enable us to continue offering services of the highest quality.