THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA

(SET UP BY ACT OF PARLIAMENT)

LOGISTICS MANAGEMENT

Submitted To: Submitted By:

MR. MANOJ KORI KRATI CHAURASIA
BATCH NO. ICITSS_ITTJBP_012
CA. CHANDANI CHOITHWANI
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 This is to certify that the project titled “LOGISTICS
MANAGEMENT” has been prepared by “KRATI
CHAURASIA” for “THE INSTITUTE OF CHARTERED
ACCOUNTANT OF INDIA” at the Jabalpur branch for
the fulfillment of information technology training.

CA. AASHISH AGRAWAL

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Chairman CRO0561551
 I KRATI CHAURASIA ,Student of IPCC owe my immense thanks
to all the people who have helped me to get this Project file
completed I wish to make a special mention of some of them.

First of all, I express my gratitude and respect ,thankful to my

subject teachers MR. MANOJ KORI & CA. CHANDANI
CHOITHWANI, and the ITT Department of ICAI,Jabalpur
Branch, for their guidance, encouragement, timely
suggestions throughout the project.

I would also like to thank my parents and friends, who have

supported me to complete this work.

Dated-6-JULY-2019

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 *What is logistics & logistics management?
*Main fields within logistics
*Activities involved in logistics management
*Types of logistics
*Rights of logistics
*Objective
*Logistics Control
*Conclusion

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 What is logistics & logistics
management?
Logistics(Definition)
:-BY-CSCMP(Council of Supply Chain
Management Professionals)
The planning, execution, and control of the movement /
placement of goods and / or people, and the related
supporting activities, all within a system designed to achieve
specific objectives.
*The explanation of logistics in a simple manner is as follows:
The supply of raw materials, materials management in a firm
and distribution of it to customers is known as logistics
management.
SUPPLY OF MATERIALS
MANAGEMENT DISTRIBUTION
RAW TO CUSTOMERS
LOGISTICS
MATERIALS IN A FACTORY

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 Main fields within logistics
1. Procurement Logistics

2. Production Logistics

3. Distribution Logistics

4. After-sales Logistics

5. Disposal Logistics

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 1.Procurement Logistics
Procurement Logistics is the entire process used
to select suppliers and negotiate contracts for
delivery of goods or services. It consists of
activities such as market research, requirements
planning, make or buy decisions, supplier
management, ordering, and order controlling.

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 2. Production Logistics
Production Logistics concerns itself with
streamlining and controlling the flow through the
supply chain from point of entry to the end, which is
distribution logistics. Production logistics activities
are related to organizational concepts, layout
planning, production planning, and control.

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 3.Distribution Logistics
Distribution Logistics is concerned with the
delivery of finished products to the customer. It
consists of order processing, warehousing, and
transportation. Major sub-sectors within the
industry include air, rail, water, and truck
transportation, urban transit and ground passenger
transportation, warehousing and storage, and
motor vehicle repair. Logistics involve the
integration of these sub sectors, including
information, transportation, inventory,
warehousing, material-handling, and packaging.
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 4.After-salesLogistics
Its services cover support for products sold to
customers, the refurbishment of returned items,
and disposal of end-of-life goods.

5.Disposal Logistics
Disposal Logistics is also known as reverse logistics,
stands for all operations related to the reuse of
products and materials. The main function of this field
is to reduce logistics cost, enhance service, and save
natural resources.
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 Logistics activities or Functions
of Logistics
(i) Network Design:
Network design is one of the prime responsibilities of
logistics management. This network is required to
determine the number and location of manufacturing
plants, warehouses, material handling equipment’s etc.
on which logistical efficiency depends. The network of
logistics is explained in the below diagram:-

CENTERS OF
VENDORS PLANTS CUSTOMERS
DISTRIBUTION

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 (ii) Order Processing:

Customers’ orders are very important in logistics

management. Order processing includes activities for
receiving, handling, filing, recording of orders. Herein,
management has to ensure that order processing is
accurate, reliable and fast.
Further, management has to minimize the time between
receipt of orders and date of dispatch of the
consignment to ensure speedy processing of the order.
Delays in execution of orders can become serious
grounds for customer dissatisfaction; which must be
avoided at all costs.

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 (iii) Procurement:

It is related to obtaining materials from outside

suppliers. It includes supply sourcing, negotiation,
order placement, inbound transportation, receiving
and inspection, storage and handling etc. Its main
objective is to support manufacturing, by providing
timely supplies of qualitative materials, at the lowest
possible cost.

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 (iv) Material Handling:

It involves the activities of handling raw-materials, parts,

semi-finished and finished goods into and out of plant,
warehouses and transportation terminals. Management
has to ensure that the raw-materials, parts, semi-
finished and finished goods are handled properly to
minimize losses due to breakage, spoilage etc. Further,
the management has to minimize the handling costs and
the time involved in material handling.
Material handling systems, in logistics
management are divided into three categories:
1. Mechanized systems
2. Semi-automated systems
3. Automated systems
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 (v) Inventory Management:
The basic objective of inventory management is to
minimize the amount of working capital blocked in
inventories; and at the same time to provide a
continuous flow of materials to match production
requirements; and to provide timely supplies of goods to
meet customer’s demands.
Management has to maintain inventories of:
1. Raw-materials and parts
2. Semi-finished goods
3. Finished goods
Management has to balance the benefits of holding
inventories against costs associated with holding
inventories like – storage space costs, insurance costs,
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 (vi) Packaging and Labeling:
Packaging and labeling are an important aspect of logistics
management. Packaging implies enclosing or encasing a
product into suitable packets or containers, for easy and
convenient handling of the product by both, the seller and
specially the buyer.
Labeling means putting identification marks on the package
of the product. A label provides information about – date of
packing and expiry, weight or size of product, ingredients
used in the manufacture of the product, instructions for sale
handling of the product, price payable by the buyer etc.
Labeling is a strong sales promotion tool. The consumer who
is persuaded to read the label may, in fact, try to buy the
product; even though he/she had no such premeditation
(advance idea).
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 (vii) Warehousing:
Storage or warehousing is that logistical activity which
creates time utility by storing goods from the time of
production till the time these are needed by ultimate
consumers.
Here, the management has to decide about:
1. The number and type of warehouses needed and
2. The location of warehouses.
The above two decisions depend on the desired level of
customer service and the distance between the supply
source and final destination i.e. markets.

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 (viii) Transportation:
Transportation is that logistical activity which creates
place utility.
Transportation is needed for:
1. Movement of raw-materials from suppliers to the
manufacturing unit.
2. Movement of work-in-progress within the plant.
3. Movement of finished goods from plant to the final
consumers.
Major transportation systems include:
1. Railways
2. Roadways
3. Airways
4. Waterways
5. Pipelines.
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 The choice of a particular mode of transportation is
dependent on a balancing of following considerations:
1. Speed of transportation system
2. Cost involved in transportation
3. Safety in transportation
4. Reliability of transportation time schedules
5. Number of locations served etc.

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 Classification of Logistics:-
Logistics may be Broadly Classified into Two
Categories:
I. Inbound logistics:-
Activities related to the material’s procurement,
transportation, handling and storing are called as
inbound logistics.
II. Outbound logistics (also called physical distribution
management or supply chain management):-
Activities that are related to the maintenance, collection, and
delivery of products to the customer’s are called as outbound
activities.

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 1. RIGHT
PRODUCT

7. RIGHT 2. RIGHT
PRICE QUANTITY

RIGHTS OF
LOGISTICS

3. RIGHT
6. RIGHT TIME
CONDITION

5. RIGHT 4. RIGHT
CUSTOMER PLACE

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 Objectives and constraints:-
To measure and study the performance of logistics systems we
can formulate objectives and constraints.

An objective is an expression that maximizes or minimizes

some goal.
Examples of objectives are:
Maximize quantity to be produced maximize profit maximize
service minimize cost minimize cycle times.

Constraints are restrictions that limit the degree to which an

manager can pursue an objective.
Examples of constraints are: Total waiting times < 1 hour total
inventory < 100 units occupancy degree > 0.90

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 Logistics control
Productivity can be used to measure the performance of
logistics systems. Productivity is the ratio of outputs (goods and
services) divided by inputs (such as labour, management and
capital). Improvements in productivity results in improvements
in efficiency.

Single factor productivity:

Output/input factor

Output includes goods and/or services. Input factors for single

factor productivity are labour, capital and management.

Multifactor (or total factor) productivity includes all inputs:

Output/(labour + material + energy + capital + other)

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 Thus, logistics management is the key to
seamless and integrated supply chain involving
efficient flow of various processes, from freight
forwarding and inventory management to
packaging and delivery of goods, by utilizing
information, technology and human resources to
attain company’s objectives.

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 Thank you

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