Page 24 - DMGT523_LOGISTICS_AND_SUPPLY_CHAIN_MANAGEMENT

Unit 1: 21st Century Supply Chains

Notes

Notes Logistics should be fundamentally taken into account regardless of the high quality
of the product.

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In the digital marketing concept of 21 century logistics quality can outweigh the product itself
in the competition among corporations. Now producer corporations give the same weight to
the quick and effective realization of logistics services as the product and new production
techniques. In the scope of logistics management, starting point of the physical distribution
subsystem must be the customers’ orders. Compared to traditional marketing activities in
processes such as obtaining the orders, evaluating and classifying them, logistics information
systems enhance the productivity of logistics activities and offer timesaving advantage. The cost
of reaching a larger body of customers in logistics system is significantly lower than the other
traditional ways by using the customer basis formed for the future marketing activities. Orders
when obtained through the order forms in the internet web sites filled in by the customer’s leads
to the sales process mainly to be carried out in internet medium. During this process, a new
distribution strategy must be developed instead of a distribution structure in a traditional
purchasing process that will enable to reach a very large consumer body simultaneously and
will include new mediator types.

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Caution It should meet the needs of customers by an efficient and effective physical
distribution subsystem.

New logistics systems have lower cost and work faster than the traditional systems in the flow
of the larger scale orders to the buyers through the logistics information technologies. In
compliance with this, putting the enterprises’ information as buyer order into the physical
distribution actions compatible with the buyer demand will be a factor providing competitive
advantage among enterprises.

Notes It shouldn’t be disregarded that the establishment of healthy and long-term relations
with consumers is dependent on the fulfilment of buyer orders perfectly and on-time.

Development of appropriate and optimum transportation system and determining of
transportation tools in this system considering the competitive advantages they offer is the
other point that should be emphasized when the information technologies is used in logistics
management.
Nevertheless, the enterprises which should establish a technological balance among the raw
material resources, inventories, sales and production could obtain optimum stock level by
taking the costs, demand, product features and competition conditions into account in the stage
of inventory planning according to the quantity and variety. Warehousing is another area
thought as one of the logistics actions starting point. This should be implemented in harmony
with the high-tech distribution processes related to the storage of goods inside and outside of
the enterprise by using the computer communication systems. While preparing the warehousing
policy and strategies, the selection process of storage place which combines new technologies
and the firm infrastructure in e-business environment should be planned to have minimum cost
and maximum efficiency to create competitive advantage against the competitors.

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