UNIVERSITY OF ECONOMIC AND LAW
Course
LOGISTICS
Instructor: Dr. Nguyễn Duy Quang
Email:
[email protected] 2024
Vrije Universiteit Amsterdam
CHAPTER 1. INTRODUCTION
Contents
Logistics definition
Main activities of logistics
Systems and total cost approaches to logistics
Integrated logistics
Logistics concepts
Logistics vs supply chain management
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LOGISTICS DEFINITION
Logistics is responsible for the movement of raw materials, work-in-
process, finished inventories from suppliers through an
organization to customers.
“Logistics management is that part of supply chain management
that plans, implements, and controls the efficient, effective forward
and reverse flow and storage of goods, services, and related
information between the point of origin and the point of
consumption in order to meet customers’ requirements.” (CSCMP)
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LOGISTICS IN VIETNAM’S COMMERCIAL LAW
“Điều 233. Dịch vụ logistics
Dịch vụ logistics là hoạt động thương mại, theo đó thương nhân tổ chức
thực hiện một hoặc nhiều công việc bao gồm nhận hàng, vận chuyển, lưu
kho, lưu bãi, làm thủ tục hải quan, các thủ tục giấy tờ khác, tư vấn khách
hàng, đóng gói bao bì, ghi ký mã hiệu, giao hàng hoặc các dịch vụ khác có
liên quan đến hàng hoá theo thoả thuận với khách hàng để hưởng thù
lao. Dịch vụ logistics được phiên âm theo tiếng Việt là dịch vụ lô-gi-stíc.”
Further detailed in Decree No. 163/2017/NĐ-CP
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LOGISTICS DEFINITION
External Operations within External
supplier the organization customer
Internal Internal
supplier customer
Inbound Outbound
Materials management
logistics logistics
Logistics
Source: Waters (2003)
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AIMS OF LOGISTICS
Product
Customer
Quality
Condition
Place
Time
Cost
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MAIN ACTIVITIES OF LOGISTICS
Customer service Packaging
Demand forecasting Material handling
Inventory management Transportation
Facility location decisions management
Warehousing Reverse logistics
management Communication
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MAIN ACTIVITIES OF LOGISTICS
Source: Waters (2003)
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SYSTEMS AND TOTAL COST APPROACHES TO LOGISTICS
Systems approach: goals and objectives of major functional
areas compatible with company’s goals and objectives
Total cost approach: all logistics cost items considered
simultaneously when making a decision
Total logistics cost = transport cost + warehouse cost +
stock holding cost + packaging cost + information
processing cost + other logistics overheads
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INTEGRATED LOGISTICS
Facility network
Warehousing
Integrated logistics
Material handling Order processing
management
Packaging
Transportation Inventory
Source: Bowersox et al. (2012)
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LOGISTICS CONCEPTS – OMNI-CHANNEL RETAILING
Source: Deloitte (2015)
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LOGISTICS CONCEPTS – OMNI-CHANNEL RETAILING
Physical and online channels are interchangeable and seamless
Source: Dreamtimes.com
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CHANGES OF PURCHASING MODELS
Source: Zebra Technologies (2018)
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LOGISTICS CONCEPTS - POSTPONEMENT
The delay of final activities until the latest possible time
o Risk is minimized in meeting various customer demands
o Total inventory can be reduced by using inventory of the
base product
Types
o Manufacturing postponement
o Geographic postponement
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LOGISTICS VS SUPPLY CHAIN MANAGEMENT
Supply chain consists of all links/stages involved directly or
indirectly in fulfilling customer’s request /order
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DETERGENT SUPPLY CHAIN
Paper Packaging
Timber Company
Manufacturer Company
Retailers
FMCG
Wholesalers (Wal-Mart, Customers
(P&G, Unilever)
Carrefour)
Chemical Plastic
Manufacturer Producer
Source: Chopra and Meindl (2016)
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SUPPLY CHAIN MANAGEMENT
“The planning and management of all activities involved in
sourcing and procurement, conversion and all logistics
management activities. Importantly, it also includes
coordination and collaboration with channel partners,
which can be suppliers, intermediaries, third-party service
providers and customers.” (CSCMP)
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LOGISTICS VS SUPPLY CHAIN MANAGEMENT
Logistics management Supply chain management
Logistics management basically consists of activities SCM refers to network among organizations
within an organization (intra-organization) coordinating to deliver products to markets
(inter-organization)
Logistics management focuses on transport, SCM consists of procurement, logistics
inventory management, warehousing, etc. activities, distribution, sales and operations,
etc.
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LOGISTICS VS SUPPLY CHAIN MANAGEMENT
Source: Rushton et al. (2014)
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FREIGHT FORWARDING
Function by a freight forwarder on behalf of
shippers/consignees to arrange and ship the merchandise
Focusing on specific areas e.g., negotiating freight
charges, booking cargo space, cargo insurance,
preparation of shipping and export documents, filing of
insurance claims, tracking transportation
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