Importance of Logistics

1875 Words Dec 17th, 2014 8 Pages
TL1033: Logistics (Part 1 – Introduction to Theory)
Level 1 – Semester 2, Bachelor of Transport and Logistics Management
Department of Transport and Logistics Management
Assessment 1

131448P

“Leaders win through logistics. Vision, sure. Strategy, yes. But when you go to war, you need to have both toilet paper and bullets at the right place at the right time. In other words, you must win through superior logistics.” - Tom Peters
The word logistics was used in warfare where logistics became a pivotal technique to win the game. In that case most of the military logistics literatures of early periods were delivered the tactics and insights to work in complex environments (McGinnis, 1992) where the flow of material and information
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It was a huge challenge to deliver goods with a low price within one day. For that they outsourced and got specialized and expertized 3rd party logistics services. Currently UPS and FedEx do a great job as performing 3PLs. But still there is a main disadvantage of e-commerce is the speed of disposal of product which does not correspond to the speed of ordering (Lekovic and Milicevic, 2013) and if this key challenge can be overcome by any technology, consumers will totally shift to e-tail as it is entirely similar to retail.

Other than cost and time utilities, logistics become an important part in e-commerce in the scope E-fulfillment as it is providing an integrated service with all operations in e-commerce. For an example, logistics activities can be used for marketing while communicating with customer face to face in a website. By that logistics forms links with customers, contributing to customer satisfaction and added value. Also this interaction can be used to build the image of corporation. At the same time, when customers received exact goods they ordered within promised duration and quality, that makes consumer to believe consistently on e-commerce (Elkhateb, 2012).

Even though logistics makes customers to retain with e-commerce, as to the statistics from statista.com still there are only 40% of internet users have bought products through e-commerce. It could be due to the challenges that accompanied with
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