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Relation Between Transportation and Logistics A simple way of defining logistics is about the procedures of transporting and handling materials and goods, wherein it entails moving the materials and goods from a point of origin, like for example the storage area of the suppliers, to the storage space of a company and from the company to the end-users, who are the customers; but within these movements are other components that play a role in logistics . Logistics is made up of three important components that are related and interlinked with one another and they are: logistics services, information systems and infrastructure. Logistics services refer to the movement of goods from the point of origin through production until the goods reach the customers and which covers storage, inventory control, transport, as well as the selection of contractors and freight negotiations. The flow and processing of logistics information for decision making and management lies on the information systems, and the purpose of which is to provide the essential data for the logistics services to proceed and complete its main function and objective. Infrastructure covers human resources, financial resources, packaging materials, warehouses, transport and communication. For as long as the transportation system is well-planned, well-designed, and well-developed, without such, logistics cannot meet its full advantage, which is having an efficient transport and material handling of goods, attaining reduce operation cost and promote service quality. In order to succeed in its logistics operation, which in turn influences production and sale, two thirds of the logistics’ expenses are basically invested into transportation. For goods or products that are of small volume, low weight but of high value, the transportation cost takes up a minimal part in the sale’s cost, but for heavy and low-valued goods or products, the transportation cost uses a great part of sales and affects profits. Because the transportation system is in itself a complex operation, as long as there is quality management, the transport system will be well-handled and, with that, goods are sent into the right place at the right time, which, in effect, brings out service quality and efficiency.
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An extension service delivery of good or products from air and maritime transports is land logistics, which makes use of the road freight transport system, railway transport system, and pipeline system. The road freight transport system has these advantages: cheaper investment, accessibility, mobility, and availability are high, but the disadvantages are low capacity for delivery, low safety of goods and slow speed; while the railway transport has the following advantages: great carrying capacity, low energy consumption, not affected by weather conditions, but has the advantages, such as high cost of facilities and maintenance, not flexible in terms of urgent schedules, and time consuming in arrangement of railway carriages. High capacity, not affected by weather conditions, cheap operational fee, and continuous transport are the benefits that can be derived using the pipeline system, but it is an expensive infrastructure, hard to supervise, regular maintenance needs.Smart Ideas: Services Revisited