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Functions of Logistics


Logistics is the physical flow process of goods from the point of origin to the point of consumption concerning transportation, warehousing and storage, loading and unloading, goods handling, packing, distribution processing delivery and information management. For example, after a commercial transaction is done, logistics will carry out the transfer of goods from the seller to the buyer for the lowest cost and in the most effective manner. During the transfer process, logistics facilities, equipment (carriers), administration of information and standardization are needed.


Logistics has three major functions. Firstly, it creates time value. The same goods can be valued differently at different times. Goods are often in stagnation during the transfer process, which is called the storage of logistics. Secondly, it creates location value. The same goods can be valued differently at different locations. The value added during the transfer process is the location value of logistics. Thirdly, it creates distribution processing value. Sometimes the distribution processing changes the packages of the goods. That is, during this stage, it cuts large packages of goods into smaller parts, which creates added value for goods.


 


1. Logistics is the physical flow process of goods from the seller to the buyer. 

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2. Administration of information and standardization are needed during the transfer process. 

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3. Storage creates the location value for goods. 

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4. The same goods can be valued differently at different times and locations. 

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5. Large packages of goods should always be cut into smaller parts to create added value. 

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