Business Logistics: What is it, Types, and Examples?


Planning and execution processes of activities are necessary for the production of goods. Everything you need to know about what business logistics is, we tell you its main definition, types and classification, examples, and more.

What is business logistics?

Business logistics is defined as the process of planning and executing activities that are necessary to distribute, transport, and store the goods required for the production of goods.

Logistics within a company is important to keep it running smoothly and avoid delays and imperfections in processes. Good Business logistics should allow the company to be efficient at a low cost.

Types of business logistics

There are different types of business logistics since their classification depends on the type of business you are talking about:

  • Supply logistics: it is based on obtaining the necessary supplies for the production process of the company. So that it can stay in operation without any problem. For this, you must consider the delivery dates of the suppliers, the types of packaging they use, how much demand will be for the product that the company sells and how to manage inventory.
  • Distribution logistics: includes international and national physical distribution, as applicable for each company. For this, storage, transport to the customer, the movement of the merchandise within the warehouse, and the time it takes to prepare an order must be taken into account.
  • Production logistics: it is based on making the production process of the company efficient and that it has all the materials that are needed. A key objective in this logistics is the minimization of costs.
  • Reverse logistics: it is the process described above but done in reverse. This can occur when a customer returns a product or when a delivery is made to a customer by mistake. It is important to have an action plan for these occasions.

Examples of business logistics

We will explain the examples of business logistics in the same example, breaking them down by type of logistics:

  • Supply logistics: a company that is in charge of producing sofas should seek to source foam rubber, leather, fabrics, metal or wood, and other supplies that it may require for the structure of the furniture. To do this, you must take into account the amount of inventory you can store and the time it takes for suppliers to ship, based on syncing this with your production.
  • Distribution logistics: once the company has manufactured the furniture, you will need to evaluate in distribution logistics the cost of shipping the sofas, how you can move them within the warehouse, what is the best way to store them and how long it takes them to prepare an order, from when the order arrives until it is delivered to the customer.
  • Production logistics: the company must design its production process combining materials and making workers work in the most efficient way possible. This design will be in charge of the management team of the company.
  • Reverse logistics: if the company makes a shipment and the sofa that reaches the customer is wrong or has failures (it is broken, for example), it should be to coordinate with the customer the visit of company representatives to remove the sofa, take it away back to the factory, repair and reship.
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