Difference between Logistics and Supply Chain

Difference between Logistics and Supply Chain

The term “supply chain” and “logistics” are often used interchangeably in the transport sector. However, these are separate areas, each with specific processes, tasks, and responsibilities. The confusion in the distinction between supply chain and logistics may result from the fact that logistics is seen by many as a subset of supply chain management. The main difference between the supply chain and the logistics is the logistics just a specialized agency of the entire process of the supply chain.

The general logistics concern the actual transport and storage of goods. There are things like incoming and outgoing freight, reverse shipping, communications during transportation, storage, and warehousing. Logistics also engaged in the supply of goods and merchandise, coordination between third-party carriers, fleet management and other activities directly related to the actual transportation of goods from one point to another.

It is common to confuse the terms Logistics and Supply Chain since both have to do with the management of business models. The most important difference is that logistics is only part of the Supply Chain.

The best way to understand it is an example: If our company is dedicated to the fashion industry, the Delivery service would include the purchase of wool and other fibers that are used as raw material, clothing designs, weaving machines, the boxes to transport it, the forklift to transport the boxes, the truck with which it is distributed to the stores, the energy used in the whole process, etc. Of all these methods, we differentiate those corresponding to logistics: transport, storage and order preparation.

Difference between Logistics and Supply Chain

The Supply Chain consists of the planning of the activities involved in the search, procurement, and transformation of the products, be they suppliers, intermediaries, officials or customers.
The supply chain supplies and regulates manufacturing, distribution, marketing, sales, and product design, finance, and technology operations.

One of the important aspects of the supply chain is the synchronization since any failure at some point would create a chain effect causing clogging and blockages.

Logistics is the set of means and methods that allow carrying out the organization of a company or a service.
The function of logistics is to efficiently implement and control materials and products, from the point of origin to consumption, with the intention of satisfying consumer needs at the lowest possible cost.

Trucking services Singapore offers how to place goods and services in the right place, at the right time and under the right conditions. This allows companies to meet the requirements of their customers and obtain the highest possible return.
The logistics management is an important part of the management of the supply chain and controlling the transportation efficiency, the fleet management, the storage, equipment handling equipment and operations picking.

The importance of Logistics and the Supply Chain

The good management of the Supply Chain is, without doubt, the key to the success of any product. Without going any further, we must bear in mind that the price of the product is always linked to the Supply Chain: When we buy a shirt, we pay for the raw material, the manufacturing process, the design, and the people who have been working on it and transportation to the store.