murphy ppt ch01
TRANSCRIPT
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Learning Objectives
To understand the economic impacts oflogistics
To learn what logistics is To learn about the increased
importance of logistics
To understand the systems and totalcost approaches to logistics
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Learning Objectives
To expose you to logisticalrelationships within the firm
To learn about marketing channels To provide a brief overview ofactivities in the logistics channel
To familiarize you with logisticscareers
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Key Terms
Cost trade-offs
Disintermediation
Economic utility
Form utility
Landed costs
Logistics
Marketingchannels
Mass logistics
Materialsmanagement
Physicaldistribution
Place utility
Possession utility
Postponement
Power retailer1-3
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Key Terms
Sorting function
Stock-keepingunits (SKUs)
Stockouts
Sustainableproducts
Systemsapproach
Tailored logistics
Time utility
Total costapproach
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CHAPTER 1
An Overview of
Logistics
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Economic Impacts ofLogistics
Macroeconomic Impacts
Economic Utility
Possession utility Form utility
Place utility
Time utility
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Table 1-1:The Cost of the Business LogisticsSystem in Relation to a Countrys Gross
Domestic Product (GDP)
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Logistics: What It Is
Council of Logistics Managementdefinition:
Logistics is that part of the supply chainprocess that plans, implements, andcontrols the efficient, effective forwardand reverse flow and storage of goods,
services, and related information betweenthe point of origin and the point ofconsumption in order to meet customersrequirements.
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Source: www.cscmp.org
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The Increased Importance ofLogistics
A Reduction in Economic Regulation
Changes in Consumer Behavior
Technological Advances
The Growing Power of Retailers
Globalization of Trade
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The Systems and Total CostApproaches to Logistics
Systems Approach
Interdependence of company and
logistics goals Interdependence of functional areas
Stock-keeping units (SKUs)
Interdependence of logistics activities or
Intrafunctional logistics
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Figure 1-1: Control Over the Flow ofInbound and Outbound Movements
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Figure 1-2The Utilization ofLogistics Serviceas a Major Selling
Point
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The Systems and Total CostApproaches to Logistics
Total Cost Approach
Cost trade-offs: changes to oneactivity cause some costs to increaseand others to decrease
Total Logistics Concept: to find the
lowest total cost that supports anorganizations customer servicerequirements
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Logistical Relationships withinthe Firm
Finance
Production Marketing
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Marketing
Place Decisions
Price Decisions
Landed costs
Product Decisions
Stockouts
Promotion Decisions
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Logistical Relationships withinthe Firm
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Marketing Channels
set of institutions necessary to transferthe title to goods and to move goods fromthe point of production to the point ofconsumption and, as such, which consistsof all the institutions and all the marketingactivities in the marketing process.Source: American Marketing Association Dictionary, www.marketingpower.com
Channel members Manufacturers
Wholesalers
Retailers 1-16 Pearson Education, Inc. publishing as Prentice Hall
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Marketing Channels
Ownership channel Covers movement of the title to the
goods
Negotiations channel Buy and sell agreements are reached
Financing channel Payments for goods
Promotions channel Promoting a new or existing product Logistics channel
Moving and storing product
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Channel Intermediaries/Facilitators
Ownership channel Banks, finance companies
Negotiations channel
Brokers Financing channel
Banks, insurance companies, financecompanies
Promotions channel Advertising agencies, public relations agencies
Logistics channel Freight forwarders
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Activities in the LogisticalChannel
Customer service Facility location
decisions
Inventorymanagement Order
management Procurement Transportation
management
Demandforecasting
Internationallogistics
Materials handling Packaging Reverse logistics
Warehousingmanagement
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Responsibilities of LogisticsManagers
A specialist
Freight rates
Warehouselayouts
Inventoryanalysis
Production
Purchasing
Transportation
law
A generalist
Understandsfunctionalrelationships
Relates logistics toother firm
operations,suppliers,customers
Controls largeex enditures1-20
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Logistics Careers
Most business organizations arepotential employers
Logistician highlighted as one onthe 50 best careers for the year 2010Source: U.S. News & World Report
Career paths for the two most recent
CEOs of Wal-Mart includedassignments in logistics anddistribution.
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Logistics Professionalism
APICS The Association for Operations Management(www.apics.org)
American Society of Transportation and Logistics(AST&L) (www.astl.org)
Council of Supply Chain Management Professionals(www.cscmp.org)
Delta Nu Alpha (DNA) (www.deltanualpha.org)
International Society of Logistics (SOLE) (www.sole.org)
Supply Chain & Logistics Association Canada (SCL)(www.sclcanada.org)
The Chartered Institute of Logistics and Transport in
the UK CILT (UK) (www.ciltuk.org.uk) Warehousing Education and Research Council (WERC)1-22
Professional Organizations Dedicated to Advancing the
Professional Knowledge of their members:
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Copyright Notice
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