1.8 Logistics and transport Introduction to logistics In order for goods to be produced, services to be delivered and customers to be satisfied wherever they are, all activities along the supply chain (see unit 1.2) must be coordinated. What is logistics? Logistics plans, implements and controls the efficient and effective flow of goods and services between the point of origin and the point of consumption where they are needed, in the right quantity, in the right condition and at the right cost. Its purpose is therefore that of synchronising the several activities along the supply chain such as order processing, inventory, warehousing, packing and transportation so as to minimise the use of resources involved in terms of time, labour and costs. Integrated logistics In the past, each individual logistical function was performed as a single entity, without considering how one work area would impact another. Nowadays, however, all logistics areas are integrated into a single functional process that incorporates the network of all actions that move the product from the raw material source to the final consumer. This integrated process is cost-effective and much more efficient than managing each single activity individually. Lean logistics Recently, most logistics companies have incorporated lean thinking into their supply chain management to improve both the logistics process and their internal organisation. is a business methodology that originated from the manufacturing methods used by the Japanese car industry in the late 1980s (e.g. Toyota) and which aims to maximise product value by eliminating any form of useless waste due to inefficiency. focuses on improving operations at all levels by reducing waste, the quality of the service and optimising the supply chain. Lean thinking Lean logistics enhancing Just in time (JIT) logistics To fulfil the goals of lean thinking and respond to new methods of inventory management, logistics has further evolved. aims to deliver goods just before they are needed for the next stage in the supply chain process, in a way that is perfectly synchronised with the necessities coming from production or sales. The objective is to increase efficiency and cut inventory and warehouse costs. However, must be able demand accurately and work in perfect synergy with the planning or sales department. Just in time logistics procurement departments to forecast