Logistics basically related to four main marketing efforts, which are price, promotion, product and place.
Price means the price of shipping cost, different distribution plan would have influences on the cost of shipping. Marketing and logistics group should cooperate to set a balanced between the product price and the shipping cost because shipping large volume usually have better discount for the transportation company.
Promotion obviously will put pressure on the logistics department, depends on “push” and “pull” method, the inventory might be out of stock in promotion because the market sometime is hard to predict.
Product itself would also have a big influence on logistics, because of the requirement of sale, the design of the product’s package and itself would have impacts on the inventory and transportation efficiency. For example, some product design need big shipping package for protection which will waste space on pallets and truck.
The place decision is also important for logistics and marketing, dealing with different partner would have big differences on transportation. Retailers usually have frequent and small quantity order; its insufficient lead time would cause high price transportation when there is stock shortage, but wholesale often have large quantity order and more stable demand.
b) What are the different types of utility, and how does logistics directly or indirectly affect each one?
There are five types of utility which form, time, place, quantity
Logistics is planning and executing of the movement and support of forces. When examining logistics I have to draw from my most
Currently the inflation rate is stable at three percent or less per year, and the consumer price index is steady with approximately 1.5-2 percent change per year. A stable economy without significant inflation will likely maintain the strong spending power of the consumer. The consumer’s dollar will be stretched further allowing them to purchase more goods. Low inflation rates will also persuade the Federal Reserve Board to keep rates low allowing free economic growth as rates increase.
Westminster Company is one of the largest manufacturers of consumer health products, based in US. Their distinctive name and company logo are recognized throughout the world. Westminster was originally founded as a family-owned pharmaceutical supply business in 1923, the company has expanded, by virtue of aggressive new product development, into a global provider of health care consumer products. It consumes three wholly owned subsidiaries, manufacturing grocery product, drugs, and mass merchandise. Intense rivalry in the market, and distresses of having an effective supply chain, made the company evaluate its supply chain and logistics. The primary focus of its research was the key clients of the three companies. To understand logistics the company must first know what logistics is and how it works. Logistics is defined as a business planning framework for the management of material, service, information and capital flows (Logistics World , 2014). Logistics is an important function of the business and without a proper logistics system, all the manufacturing, marketing and other activities would fail, overall resulting with the company failing to reach its full potential. After thoroughly analyzing the case study of, Westminster Company, to improve their current logistic strategy, they would need to implement the following strategies: developing and analyzing a new system to focus on strategic effort to ship their products in a timelier, efficient and in a more accurate
Without emphasize the price and product strategies previously discussed, a brief analysis of the marketing mix underlines some other specific traits of the company. An interesting aspect is represented by promotion. In the solar Industry a great part of the promotion effort lies in the downstream, and this is where SolarCity put a greater effort: on the 2,510 employees (2012), 661 work in sales and marketing and 248 work in customer care (SolarCity, “SolarCity annual report 2013”, SolarCity, 2013). SolarCity promotion relies mainly on a well-trained direct sales force used for what the founder calls in-house sales. The direct-sale force is backed up by a call center and a cross-promotion channel partner such as Home Depot (home improvement supplies superstore) and customer referrals. It is also true that not all of the promotion effort lies on the downstream of the industry. Customer sensitization, especially in a young industry such as the solar one, is a shared need and in addition seen the involvement of government in the industry join effort may become a necessity. To fight the opposition on the “Net metering” and the planned decrease in governmental subsidies many solar companies formed trade associations for lobbying purposes and industry-wide advocacy groups. In addition all companies in the industry are active supporter of various “green initiatives” aimed at the sensitization of potential customer toward a “sustainable lifestyle”. Solarcity also
Define the effect of transportation on the situation Greater prospects are available for truckload shipping volumes with consolidated distribution centers and assorted product shipments. This would necessitate fewer outbound shipments, with each in larger quantities for better transportation savings. The possible longer distances from distribution centers to customer locations might be the only disadvantage to transportation cost.
Over the last few decades, the role of logistics in business has increased in scope as well as in strategic importance (Caplice and sheffi, 1995). In general, distribution logistics is expected to ‘provide the right goods at the right time, at the right place, in the right amount and quality, and at the right price’ (Jünemann & Daum 1989, p. 18.)
It emphasizes on differentiation of logistics operations, effectiveness and efficiency. Fugate analyzed the relationship between organizational performance and logistics performance and concluded that logistics performance is not only multidimensional but also a function of resources used in logistics in relation to outlined outcomes and objectives against other players’ in the industry or competitors. The authors concluded that the better the joint quality of planning, human resources logistics and customer feedback and satisfaction, the lower the levels of redundancy, waste, and inefficiency (Fugate, et al 2010.p8-22).
Place = Place play an important role in the company as location matters most. If the location is near the city, town, etc then there is more sales and it matter more for customers.
Logistics is a process by which an item is moved from its point of creation or production to the point at which it is used as planned by a company, a government or similar institutions. The items moved within a network could be Dangerous Goods, foodstuffs, ammunition, electronics, building cranes and whole host of other products. Time and financial considerations are considered when making these plans as are government regulations that guide the movement of items within a network.
Logistics is the administration which synchronizes such giving activities as acquirement, processing, bargains, and dissemination with requests. It plans to upgrade corporate aggressiveness and increment corporate esteem by acknowledging satisfaction of clients' fulfillment, reduction of unfruitful stock and minimization of its exchange, and decrease of supply expenses.
Why is transportation so important? There are different kinds of transportation. Transportation is used to get people or things from point b to point a. Without transportation how would things get moved? According to an article written by Marco Cristini, transportation has had a huge impact on many countries and without transportation it would be difficult for customers to receive their items from oversea. Like Newton’s Third Law, transportation controls the opposed reaction to every action. For example, when purchasing items online from Ebay, a website that sells goods, Ebay uses FedEx to transport items to the customers. When it comes to logistics and supply chain, transportation plays a major role. Each of these has a role to play. They all are connected together in one way or another. Sheikh explains that logistics activities cover the entire supply chain so they become important involving in improving supply chain’s overall performance. The goal of the logistics process is to merge and organize all activities involved in acquiring, converting and distributing goods from raw materials to finished goods to the customer in order to achieve customer service objective in a proficient cost efficient way (Bryne and Markam, 1991). Logistics is the main event that is where everything is coming from. Logistic is a part of supply chain which is also a part of transportation. The supply chain consists of 3 areas which includes
Logistics and supply chain management is the process of making sure materials are collected, tuned into products and then distributed so that they can reach the user. Logistics is the full process of the gap between the materials being raw and collected to the delivery of the finished product in the users hands. “As such logistics includes;
Logistical operations has come a long ways since the 1800’s, in the past workers would just place items on ships bound for their destination without the knowledge and concept of maximizing space, and basic operation. Today a lot more specification goes into the planning and procedures of logistics operation. Before a company decides to ship materials or products they take into consideration a number of things. A company will look into the most efficient form of transportation for their products, and that might be by air, land or sea. After that decision is made, companies take
Managing your logistics supply chain can become very expensive, if not controlled effectively. For example, holding stock or inventory for insurance purposes can be very expensive and the stock could be of value but loses its value when it does not sell or becomes obsolete. Operating and running warehouses and distribution centers are expensive considering the building, operation, and maintenance costs involved. A company’s distribution network can be expensive in terms of capital and running costs. It is pertinent that your logistics strategy is well thought out and aligns with the company’s goals and current demands of the market. A company’s logistics strategy must be carried out allocating resources effectively and efficiently to be competitive and successful.
Transport plays a critical role in the supply chain and according to Bhattacharya et al. (2014) it is becoming one of the key components of the whole supply chain valuation for many organizations. Transportation is the movement of good from one location to another. Supply chain is a network of individuals, organizations, activities, resources and technology that is involved in formation and sale of a product, which is from the delivery of source materials from the supplier to the manufacturer, through to the end user. Hopkins (2007) states that supply chain professionals look at whole business procedures, which is from raw materials to manufacturing, wholesaling and retailing. And by