Logistics Archives | Capital Express Lines

26 January 2021 Logistics

What Are the Types of Logistics?

Generally speaking, logistics is the management of moving things, such as products and goods from their point of origin to the end-user. Normally this is the movement of food and other consumables, supplies, hardware or material from the manufacturer to the customer or client who has ordered and purchased the item in question.

You may already understand that side of logistics, but did you know there were 6 different types of logistics? In the following post, we highlight these 6 kinds of logistics that are most used and give a brief insight into what each involves.

Inbound Logistics

Inbound logistics, as inferred by the name, involves the activities required for the incoming resource flow that a company needs to manufacture a product or setup a service. It can involve the management of supplies, inventory, costs and transportation to make sure the correct components and units or sub-assemblies reach your factory or manufacturing plant on time.

Inbound logistics is perhaps the most complicated of the three as it often involves many hundreds of parts and units coming in to be manufactured into one single product or a line of products.

Outbound Logistics

Outbound logistics, on the other hand, is the part of a supply chain that involves the activities required to deliver the correct product to the correct end-user or customer at the correct time for the lowest price possible. With outbound logistics, the most important thing is ensuring you provide the best experience for a customer. This is why so many companies try to offer same-day or last-mile delivery services to the customer.

Distribution systems are imperative to successful outbound logistics. The transportation systems and distribution channels a company use should support the level of value it is looking to provide to its customers. The retail sector, the online and e-commerce industry, is where effective and efficient outbound logistics is needed most. If you consider companies like Lazada, Walmart and Amazon, who are successful in this area, they are always improving and upgrading their facilities and the technology they use to enhance their logistics performance.

Reverse Logistics

It may sound a little strange at first, but reverse logistics makes a lot more sense when you really think about it. Reverse logistics involves the movement of products back to their point of origin from the customer or client who is the end-user so that they can be disposed of properly or so the company can recover their value.

How is the value recovered? Through recycling or even governmental incentives for proper recycling practices and products, scrapping, reusing, refurbishment or reworking.

Take an iPhone as the perfect working example of what reverse logistics is and why it is so valuable. When an iPhone is sold, if there are any defects in it of any kind, and it is still covered by its warranty, it can be returned to their carrier network who then ships it back to Apple who then refurbishes it.

At the factory, the team inspect the phone to see what the issues are and then replace the software and parts that need to be replaced and fix whatever needs to be fixed. That iPhone is then given a new model number or serial number and put back out for reselling, so Apple benefits from the value generated.

Many different types of product returns involve reverse logistics, such as end of life, refurbishment, recall or commercial return. It is therefore important for companies to have the infrastructure and systems in place to handle returns so that they can increase their visibility and recaptured value while reducing recovery costs.


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16 November 2020 Logistics

Understanding the Difference Between Shipping and Logistics

There are a lot of terms and jargon used in business that appears to be the same things. Within the world of product manufacturing and distribution, there are two terms that, particularly by the uninitiated and business newbies, are used interchangeably.

The two terms in question are logistics and shipping. Many people just consider these terms to be referring to the same thing. Are they really just different words used for the same thing? The short answer is no. To help you understand why, we are going to look at the two terms separately, discussing what each means, what they cover in a supply chain and what makes them different from one another.

First, let’s discuss shipping.

What Does Shipping Mean?

Shipping in business is the movement or transportation of products, goods and materials from one location to another. There are various kinds of shipping that are required for the movement of different types of goods or to meet the different demands and requirements of a company’s customers. Although they involve different transportation types, arrival times, handling and documentation, they are essentially the same thing – taking something from one place to another.

What, Then, is Logistics?

This is where a lot of people have difficulty separating logistics and shipping from one another. Logistics is, in the most basic definition, the comprehensive organization and implementation of complicated operations. Take a business that manufacturers products (it doesn’t matter what the products are and what industry the company is operating in), the logistics side of things is crucial for managing the flow of those products. That is, through the different departments or parts of the business, from their point of origin or creation through to their point of consumption, when they reach the end-user or customer.

Therefore, rather than just involving the transportation of the goods, it also involves processes like the packaging, warehousing and handling as well as many other aspects too numerous to mention.

So, What Are the Differences Between Logistics and Shipping?

As you can undoubtedly see from our brief overview of both areas of business, the main difference is the scale and scope. Logistics covers more than the shipping. It is a hugely important component of successful supply chain management, which is vital for any business strategy.

Logistics offers additional benefits and functionality from simply having a shipping service. Managers of logistics teams need to be able to make the best decisions about all kinds of aspects of the process of getting the items from the point of production to the end-user. This includes importing, exporting, insurance and containerization in addition to what has already been mentioned.

The crucial thing companies need to realize and appreciate is that, despite the many differences between these two terms and aspects of business, they both have a part to play.

Even being part of the overall logistic services offered by a company, the shipping side of things need to be handled in harmony with everything else.

Be Careful When Choosing a Company

So, now you know. The easiest way to break it all down would be that logistics covers everything from getting a product or materials from its starting point or production point to the end-user, which includes shipping.

Although these do normally go hand in hand with one another, some businesses simply deal with shipping. A company that just offers to ship may not offer any other help or services related to logistics. When choosing, you need to be sure you are getting the right kind of service to meet your needs.


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12 October 2020 Logistics

What are Logistics Services?

Whether you are new to the business of selling products or even services to your end-users or have been in business for some time, there are two important aspects that you should give some consideration to – shipping and logistics services. Whereas shipping is straightforward enough to understand – that is getting the items ordered by a customer to them from your premises or whoever you keep them.

What then are logistics services? To understand that you need to understand why you might need it. You see, when you are just beginning or running a small-scale business, handling all the orders and deliveries yourself or through a small team, will be easy enough. However, if you are a bigger company or are expanding, you will find that eventually, the whole process of fulfilling customer orders and shipping out a large volume of products is a lot harder.

Now that we’ve explained that, we will look at the role of logistics services and the different types of logistics services that are most used.

What is the Role of Logistics in a Business?

As you are probably aware, there are many stages (depending on, again, the scale of your business) between the design and manufacture stage of your products to the shipment stage. After your stock has been designed and produced, it is generally sent to a storage facility, such as a warehouse or something similar. Even if this is in the same business premises as the manufacturing area, this adds additional complexity to your operations.

Logistics is involved in every key stage from that first point through to deliver, including when it is stored in a warehouse setting waiting to be shipped out. Before it can be shipped out, once it has been ordered, the right kind of transportation for shipping needs to be decided upon. On top of all that, delivery times need to be considered, as do outside elements such as weather conditions and traffic.

A company that offers logistics services is generally involved in some, or in many cases, all these parts of your business.

Different Kinds of Logistics Services

Now that you understand the role of logistics a bit better, you need to understand the different kinds of logistics services offered by companies. This will help you to choose the right company and service to meet the unique needs and requirements of your business. Before we discuss that though, it’s important to highlight that you may come across the terms 3PL and 4PL. These initials stand for Third-Party Logistics and Fourth Party Logistics.

Warehousing

As noted earlier, once a product has been made, it is normally held in a warehouse until it is ordered. Though in some cases, it may be held at several warehouses during its journey from the factory or production plant to the end-user. While many companies prefer to use their own warehouses, others rely on the services of logistics companies. If a company offers to warehouse it usually means they will not only ship out the goods but keep them stored safely until they have been ordered too.

Freight Shipping

When your company is responsible for the manufacturing of larger items and bigger orders, in terms of volume size, you may need more than just standard transportation. It may be that you need freight shipping. This involves a combination of different transportation vehicles such as trucks, cargo, trains, ships and in some cases, planes. Included in the freight shipping offered as part of logistics services is aspects like drayage that allows product orders to be shipped from ports to the warehouses where they can be stored.

Freight shipping has its own complexities and involves constantly fluctuating shipping times, demands, shortages in labor and much more. Companies that offer logistics services are responsible for ensuring products are delivered on time regardless of what problems come along.

Courier Shipping

One of the most widely recognized and popular forms of logistics services is courier shipping. Compared to freight shipping these tend to deal with smaller items and smaller volumes of orders.


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25 August 2020 0Logistics

What does a logistics company do?

While it’s more than likely the case that you have heard of logistics companies before, have you ever stopped to think what they do? If you are already using their services, you probably are familiar with how important they are, but if you are just starting out in shipping goods and products to your customers or have only recently developed and grown your business enough that your delivery schedule has ballooned, you may need some of the gaps filled in.

That’s what we aim to do with this post – we want to make it clear what a logistics company does and why utilizing the experience of a logistics company is so important.

What Does a Logistics Company Actually Do?

A logistics company is one that not only devises the plans for storing and moving goods and products on behalf of their customers but also implements those plans and monitors and manages the whole entire process from start to finish. They normally work as part of a larger supply chain and are a midpoint between where the products and goods were made and store and where they are going.

Different Kinds of Logistics Companies

The term logistics company does not just apply to one specific type of company. Rather, within the logistics sector, many different companies provide different levels of service, who all count in some way as being logistics companies. The best way to understand the differences between businesses operating within logistics is by separating them into four distinct categories:

Third-Party Logistics Companies (Often referred to in shorthand as 3PL Companies) – these companies specialize particularly in providing part or all the logistics within the supply chain for a business. The extent of the chain that they supply depends on each customer’s needs. It could be that they only supply the storage and transportation side of things or act as an integral part of the business model involved operating a warehouse and taking care of picking, packing, management ordering and delivery.

Carriers – as the name suggests, carriers are companies that handle the delivery of cargo, whether its materials, products or something else. They include ocean freight, air cargo and rail companies.

Freight Forwarders – interestingly, most freight forwarders do not have freight transportation, but act as a middleman or facilitator in each supply chain, collaborating with a network they have established to find the best transportation solutions for their customers. They not only coordinate the transportation but also deal with the associate documentation like export and import forms.

Freight Companies – as the straightforward name suggests, freight companies are those that take your shipments from one point to another. They can range from small, local businesses to large, international ones. While many handle just one type of transportation, others provide many different options to suit a company’s needs.

Why Hire a Logistics Company?

The success of any business often comes down to how organized and efficient their supply chain is. Logistics has an integral role in ensuring your business can continue to grow and expand. It may be fine to handle your own deliveries when you are still a small and relatively local company, but as the volume of orders increase and you start to offer deliveries further afield, it makes sense to hire an experienced logistics company to handle that part of your supply chain.


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