Logistics call for an understanding of the total supply chain, the elements of which include inventories, packing, forwarding,

freight, storage and handling. Logistics is responsible for all the movement that takes place within the organization whether it is inbound logistics of incoming, raw materials or movement within the company or the physical distribution of finished goods, logistics encompasses all of these. Typical logistics framework mainly consists of Physical Supply, Internal Operations and Physical Distribution of Goods and Services. To put it more simply, the material supply logistics starts from the base level of generation of the demand, through the process of purchase and supply of material from the vendor right through to final acceptance and payments to the supplier and issue to the indenter and has to be considered as a one whole activity with each stage having an impact on price/cost of material supply. Logistics is, in itself, a system; it is a network of related activities with the purpose of managing the orderly flow of material and personnel within the logistics channel.

DEFINITION :

The simplest way to.describe logistics is to say that it is all about ways and means of meeting the demand for materials i.e. satisfying the customer with what he wants, when he wants, where he wants etc. Definition includes outbound, inbound, internal and external movements and returns of material for environmental purposes. The logistics concentrate on dynamic processes, related to the flow of materials and the relationship between the materials and their use at different facilities. The most wide spread definition from council of Logistics Management says that Logistics is the part of the supply chain process and plans, implements and controls the efficient, effective flow and storage of goods, services and related information from the point of origin to the point of consumption in order to meet customers requirements.

SCOPE: Logistics is not confined to manufacturing operation alone. It is relevant to all enterprises, including Govt. institutions such as Hospitals and schools and service organization such as retailers, banks and financial service organizations. The study of logistics is especially important for bulk raw materials, where substantial outflow of freight is involved. Management of Logistics is an art which is extremely difficult to perfect in India, JIT ends up being SHIT - some how in time. The study of logistics is important to establish a lean supply chain which would give an advantage of quick product change over, capability, excellent short and long term forecast visibility and JIT capability.

MODES OF TRANSPORTATION IN LOGISTICS :

In order to transport material from one place to another Logistics Managers are using Rail, Road, Air, Water & Pipe Line as the modes of Transportation. A logistics expert needs to understand these modes based on priorities, product type. lead time etc. to decide the appropriate mode of Transportation.

Rail: Used for delivery of a wide range of goods including coal, iron ore, cement, food grains, fertilizers, steel, petroleum products and other heavy goods.

Road : Used by suppliers to deliver goods in a cost effective manner and best suited for short distances. Many transport companies have expertise for fast delivery, packaging etc. for making scheduled delivery.

Air: Used mostly for delivery of high value and tow volume goods from distant suppliers, usually not connected by any other mode of Transportation. It is also suitable for emergent item to be imported for some specific requirement.

Water : Used by firms for delivery of goods from distant suppliers, mostly conducted in containers of varied size. This mode is ideal for transportation of heavy and bulky goods and suitable for products with long lead times.

Pipe Line : Used by oil sector companies for mass movement of Petroleum products including gases. Due to quite low operating cost it is one of the preferred mode of transportation.

THIRD PARTY LOGISTICS :

Third Party Logistics (3PL) provider handles all or most of freight of the organizations including the management of information by the third party, freeing the company from day to day interaction with carriers, and having to oversee hundreds or thousands of shipment. New and cheaper information flow resulting from internet enabled solutions, will lead not only achieving immediate cost reductions in operations but also to enormous productivity gains over the next few years.

The tracking and control of movement of goods drive freight optimization and asset utilization. The options are : increased trailer utilisation, combining full truckload shipments, consolidation, aggregation of smaller buyers. Purchase asset based transportation is becoming increasingly a commodity.

To put simply, 3PL refers to the outsourcing of a logistics function. It could be the use of a transportation carrier, a warehouse, or a third party freight manager to perform all or part of a companys production distribution functions.

The principle reasons of for this function are as under: Globalization of sourcing, manufacturing and distribution leading to an increase in the complexity of material movement. Competition that has forced companies towards more responsiveness and a reduction in inventories. An increased need for small but frequent shipments with 100 percent reliability, requiring core competence in logistics management. Resource constraints that require companies to concentrate only on their core manufacturing or new product development activities.

Case : Logistix Worldwide is a leading third party logistics (3PL) and distribution company, serving manufacturers in a variety of industries including lighting, office products and publishing. It is strategically headquartered in Tennessee, a two day delivery point of 80% of the US population, with additional facilities in Los Angeles, Rancho Dominguez and Oakland, California, as well as Edison, New Jersey. With the latest technology, industry expertise, and a growing customer base, Logistix manages its customers supply chain needs from point of manufacture through to final customer delivery. As many of its customers operations are based entirely overseas, Logistix is often the sole U.S. presence for these organizations. Logistix manages all receiving and shipping, responds to all customer service inquiries, and provides day-to-day inventory management on behalf of their customers. With a lean staff to keep costs competitive, Logistix leverages the latest in technology to streamline its operations without impacting its relationship with their clients and their trading partners.

Providing 24/7 Visibility to a Global Customer Base Logistix sought to provide its customers with near real-time visibility to the shipping status of their orders and inventory levels. It faced a choice of increasing it customer support staff to handle inbound customer calls at any time of day, or implementing a new software solution that would provide this information to customers securely over the Internet. Either choice would need to provide its global customers with timely information regarding Logistix operations. After carefully considering their customers needs, a thorough evaluation of available software options, and related costs, Logistix selected 3PL Centrals on-demand warehouse management solution (WMS), 3PL Warehouse Manager, in 2004 in lieu of expanding their internal resources. With 3PL Central, they are able reap the rewards of a robust WMS solution to manage their distribution activities and, just as importantly, enable its customers to track their shipments and inventory with access to data from a real-time, 24/7 WMS system. 3PL Warehouse Manager is a web-based solution with no software to install, maintain, or update, keeping IT overhead to a minimum and providing global access to Logistix data from any PC connected to the Internet. After selecting 3PL Central, we chose to implement 3PL Warehouse Manager immediately and run parallel systems for six months to make the transition easier on Logistix and our customers, stated Erik Hinson, Managing Director at Logistix Worldwide. We found that our

staff was spending hours entering data into the old system, while 3PL Warehouse Manager could input our information in real-time. Within just six weeks, we decided to turn off our older system and use 3PL Warehouse Manager exclusively. We have the highest confidence in the 3PL Central solution as the right technology for Logistix Worldwide and our customers. No matter their location or time zone, Logistix customers can access reports online, allowing them to view real-time inventory status, shipment status, parcel tracking information, and more. In addition, they are automatically notified of via email of key warehouse events (e.g., receipts, shipments, etc.).

Offering EDI Without Becoming Experts Todays global supply chains are relying on visibility and communication, namely achieved through Electronic Data Interchange (EDI). As business grew for Logistix, the need to support retailer EDI became critical to support existing and new customers. EDI is a requirement to participate in most supply chains, and one that often makes manufacturers uneasy about its costs and their responsibilities,continued Hinson. At Logistix, we educate our clients on how EDI can help them to grow their business by securing new retail customers or growing the volumes carried by current customers. Retailers usually show preference to their EDI-capable vendors. We put our customers EDI concerns to rest as EDI can be easily integrated into our costeffective services. When looking to add EDI to its capabilities a few years ago, Logistix was again faced with adding IT staff and systems, or leveraging EDI capabilities and expertise available from a Software-as-a-Service (SaaS) or on-demand service. After speaking with some of their partners and customers, including existing 3PL WMS provider 3PL Central, Logistix selected SPS Commerces web-based EDI service, SPSCommerce.net. With a pre-wired and proven integration with 3PL Centrals WMS system, SPSCommerce.net was processing Logistix EDI in a very short period of time. SPS service had proven EDI connections with many of our customers trading partners including Grainger Industrial Supply, Office Depot, Staples, and Wal-Mart, as well as more than 1,300 other retailers, grocers and distributors future customers might request, commented Hinson. In addition, they had a reputation for

working well with their customers and could scale to meet our growing needs. With SPS expertise and robust service, we are confident of their EDI service as glad to integrate it into offerings. Logistix use of SPS services scale to enable them to service new customers and account for the seasonality of some of their customers business. Each month they are processing more than a thousand EDI transactions with plans to grow this volume as their business, and their clients business grow.

Delivering a Competitive Advantage By offering online visibility and comprehensive EDI, Logistix is able to deliver more to its customers while keeping its costs low and customer satisfaction high. It has also attracted new business. 3PL Central and SPS Commerce have given us a competitive advantage and without the combined solution we would not have been able to grow our business so quickly, explained Hinson. We have more to offer our customers and can service large and small accounts alike with our knowledgeable staff. Due to our WMS and EDI capabilities, Logistix has signed on new accounts that desired these services as part of their 3PL relationship.

FOURTH PARTY LOGISTICS : Fourth Party Logistics (4PL) provider is a supply chain integrator that assembles and manages the resources, capabilities and technology of its own organization with those of complementary service provider to deliver a comprehensive supply chain solution.

4PL is emerging as a path to achieve more than the one time operating cost reductions and asset transfers of a traditional outsourcing arrangement. Through alliances between best-of-breed third party service providers, technology providers and management consultants.

4PL organizations can create unique and comprehensive supply chain solutions that cannot be achieved by any single provider. According to John Gaftorna, White outsourcing third party logistics is now a accepted business practice, Fourth Party Logistics is emerging as a breakthrough solution to modern supply chain challenges... to provide maximum overall benefits.

4PL can be described as the complete outsourcing of the logistics function including procurement of service providers. 4 PL companies are suppliers which have the expertise to manage resources, value delivery processes and technology for their clients in order to allow their clients to totally outsource their logistics management activity. The 4PLs do not compete with 3PLs as they have superior expertise in their respective fields by virtue of their investment and specialization.

4PL providers do not own assets for transportation or warehousing, but rather leverage the solutions created by 3PL.providers, in order to identify and provide best in class services to their clients. There are many variations of the 4PL model that are practiced.

Three different models are summarized as under;

A) Lead logistics provider: The 4PL provider acts as an in house freight management company, it might or might not have a role in the selection of 3 PL partners. It takes care of transport invoicing and the monitoring of the performance of the 3 PLs.

B) Solution Integrator: In this variant of the model, the 4PL acts as the integrator of various 3PLS and as a single window for freight negotiations, 3PI selection and freight management on behalf of its client.

C) Industry Innovator: Under this model the 4PL uses its expertise and resources to create a solution not for any single client, but for offering 4PL services to a number of clients in an industry.

The services provided by a 4PL provider are: Freight Negotiations with 3PLs Freight Contract Management Transport Billing Continuous Improvement Programs Management of Service Providers IT Solutions

 Risk Management and Insurance Cash-flow Management.

RESERVE LOGISTICS:

Increasingly, as a strategy, to compete on services, companies offer repair and replacement services for their products under the warranty periods. The defective products are often shipped across international borders to common repair centers to be refurbished and returned to the originating station. Logistics service providers who offer these services have to tackle issues pertaining to duty payment on refurbished products, customs documentation and the establishment of collection points for repair for the customers.

CONCLUSION:

Logistics is one of the area of the supply chain i.e. growing at a tremendous case as the Internet and E-Commerce is drastically changing the range, delivery time and the speed of information as well as ordering and payment process. Due to the big boon of information technology, greatly influencing and enhancing the effectiveness of logistics, the time is not far when 5 PLs and 6 PLs may emerge which will probably we doing part of the manufacturing and marketing for the organizations.