How the Supply Chain in Logistics Works?

by | 30/09/2021

3 minutes to read

The definitions of logistics and supply chain tend to be confused in different regions of the world, being used interchangeably.

Some professionals no longer see the difference between the two terms, treating the entire process in the same way.

Knowing the uniqueness of each area and how they work is essential to correct the focus of operations and improve management.

For this reason, we have prepared this content for you to understand once and for all how the supply chain in logistics works.

Enjoy your reading!

What is the difference between suply chain and logistics?

Logistics started to be studied around the 1980s, while the supply chain is a more recent definition.

Perhaps because the supply chain is a new field of study, the terms get confused due to functional areas that intermingle.

To clear up the misunderstanding, we’ll look at the main differences between supply chain and logistics.

In short, supply chain management encompasses more operations, including logistics. She is responsible for the production until delivery of the product.

While logistics is more focused on the processes of product displacement, storage and delivery to the end customer.

Another difference is that the supply chain seeks as a result to make the company more competitive, while logistics focuses on customer satisfaction.

How does the supply chain in logistics work?

As we have seen, the supply chain works to make the company stand out in the market, so its focus on logistics will be to optimize it for better results.

The management of the supply chain in logistics will seek advantages in transport, storage, stock and delivery with better cost-benefits.

These areas, when they are effective, reduce or avoid risks and waste, contribute to a good visibility for the supply chain and cooperate for the company’s expansion.

By achieving these benefits, the supply chain in logistics creates value in the company, which we will see some examples in the next topic.

How does the suply chain generatevalue for logistics? 

The supply chain creates value when it ensures that logistics is a factor in the company’s competitiveness.

Here are some ways this can be done:

. Good partnerships and suppliers;

. Use of beneficial transport;

. Use of technologies that ensure product visibility, agility and quality;

. Automated processes that facilitate management;

. Optimization of warehouse spaces;

. Intelligent inventory management based on demand;

. Search for innovation, improving processes;

. Implementation of improvements based on feedback received from customers.

Effective logistics alone are capable of generating value for the company, going beyond guaranteeing the delivery of a quality product to the end customer.

It manages to have a range of products, according to demand, at the right time, due to the agility of the resources it has.

But managers who intend to be more strategic, take advantage of the full potential of the supply chain in logistics, giving new possibilities for the company to prosper.

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