Marketing Channels (logistics)

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Logistics defined
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That part of supply chain management that plans, implements, and controls the efficient, effective forward and reverses flow and storage of goods, services and related information between the point of origin and the point of consumption in order to meet customers’ requirements.
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Forward Flow
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Quality, amount, pricing–>supplier–>Transportations–>air freight, shipping–>import–>customs–>storage–>distribution channels
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Reverse flow
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The merchandise return path. Consumer->retail store->Central return center->overseas remarker or local remarker or original vendor (recover/remarket/recycle/reuse)
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Event logistics
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The resources (facilities, people, and infrastructures) used to organize, deliver, and execute an event through an initial schedule to clean up ex. Oktober Fest in Germany, Summer Olympic games
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Passenger logistics
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Moving people ex. scheduled or private airplane flights, bus rides, highway travel
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Military logistics
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Moving groups of people and supplies, setting up camps, replenishing supplies and people, and breaking camp down again and moving it out
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Service logistics
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All the people, facilities and supplies in place to effectively deliver services to customers ex. hair salon, hospital operations
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Humanitarian logistics
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Effective planning, flow and storage of goods, information to alleviate the suffering of people. ex. red cross assistance of Haiti after 2010 earthquake
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Movement, Storage, and Processing
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Movement: transportation Storage: warehousing, in-transit Planning: Flow of information, tracking, visibility when aligned to support customer value= delivering your promises to you customers
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The seven R’s of logistics
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The “Right” Product in The “Right” Quantity at The “Right” Place at The “Right” Time in The “Right” Condition for The “Right” Customer at The “Right” Cost
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The value-added role of logistics
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Utility- perceived value, Possession- creating desire, Form- repacking, refurbishing, Time- when needed, place-exactly where needed, quantity- right amount-break bulk and assort
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Logistic interfaces in the firm
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Logistics Interfaces with Manufacturing Marketing Finance/Accounting HR
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Logistic interface with manufacturing
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Length of production runs Seasonal demand Supply-side interfaces Protective packaging Foreign & third party alternatives
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Logistic interface with marketing
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Logistics Interfaces with Marketing: The Marketing Mix – Four Ps Price Product Promotion Place
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Logistic interface with finance and accounting
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Logistics–major impact on return on assets and return on investment. Logistics costs reported by cost systems measure supply chain trade-offs and performance.
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Other important interfaces include
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Human resources, and engineering data
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Reinvent 19th century business structure
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The Empowered Consumer A Power Shift in the Supply Chain (organizational consolidation) Government Policy & Regulation Globalization Technology Emerging Economies (don’t spend too much time)
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How do we know when logistics is performing well?
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Cost Minimization Revenue Enhancement Asset Optimization The impact that logistics can have upon return on assets (ROA) or return on investment (ROI) is very significant
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Logistics Management is
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the process of moving and positioning inventory to meet customer requirements at the lowest possible total cost.
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Cost perspective
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The critical concern is to have the entire system operating at its lowest total cost.
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Level of Optimality
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Logistics systems must work in harmony with marketing, finance, production, etc.– this may result in sub-optimal logistics performance but optimal corporate performance.
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Performance trade offs
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A high-performing logistics system requires many trade-offs There are costs associated with service improvements. The closer you get to 100% perfection the more costs rise. Must decide what is good enough…

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