Types Of Logistics Innovation And The Customer At Much Faster And Efficient Way

1691 Words Mar 21st, 2016 7 Pages
Logistics is a very important part of our every day lives, and it’s the reason why we have food on our table, and gas to fill our car to get to work. Almost everything we do on a daily basis involves logistics. In this research paper we will look at the different types of logistics innovation that companies are using to save money and get the products to the customer at much faster and efficient way. Amongst the innovation we will be looking is just in time logistics, and how companies are using this method to prevent stockpile. We will also look at containerization, and some of the advantage is has given to logistics operations. We will look at technology like RFID, and how this technology is improving the method of inventory taking, and …show more content…
One of the innovative ways companies are able to cut down logistics cost is through Just In Time Logistics (JIT). With JIT, companies order goods and products as they are needed, which results in less waste and increased efficiency. Companies that move towards the practice of JIT are companies that practiced the make to stock approach in the past. With make to stock companies order goods and products based on forecasting information, and push the sales onto customers. Companies that take this type of logistical approach found themselves having to take on additional cost. Some of the cost that result from make to order, are cost of storage, as large amount of inventory had to be stored in warehouses. Companies also would have to pay to maintain, and secure the warehouse, as they would need to have workers on the clock to take care of daily cleaning, and security guards to make sure that nothing is stolen form the warehouse. “ The primary objective of JLT practices is to eliminate waste. Waste in JLT are not limited to tangibles items such as excessive inventories and defective items, but also intangible items such as under-utilized manpower and facilities that have better uses elsewhere”(Cheng, & Lai, 2012, p.6). With JLT production of the product is lunched after the customer has placed the order, once the production commences items arrive just in time to meet those customers demand. When companies use JIT, there is no large
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