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Linking elements of logistics to supply chain

Now you recognise the elements of logistics, you need to be able to link them to a supply chain.

The diagram below highlights some of the key elements of a supply chain. These include:

  • Time
  • Money flows
  • Inventory
  • Physical material flows
  • Information flows

Elements of logistics flows – some illustrations macrovector/Freepik. For time, this is the order to delivery lead time. For money flows, this is the cash flow cycle, which is cash out and cash in. For inventory management, you have the stages involving supplier, raw material inventory, material processing, in-processing inventory, sub-assembly, in-processing inventory, assembly, finished goods inventory, and customer. You have the physical material flow and the information flow, which includes schedules, information and invoices.

Click on the image to expand and zoom in.

Time is one of the Rs of logistics and would be linked to the transport and warehouse elements.

Money flows is linked to right price of the goods to the consumer.

Inventory in a supply chain is the same as in logistics. The importance of stock levels and location is vital to both logistics and supply chains. Logistics tends to focus on actual stock levels where a supply chain view would be more concerned with the geographical location of inventory.

Physical material flows links to transport, packaging and material handling elements within warehousing.

Information flows is similar in both supply chains and is a key element of logistics.

Your task

In Step 1.5, we asked you to think about the different stages and logistic flows involved when manufacturing a bicycle.

For this task, list the supply chain diagram of a product you are familiar with and identify the elements of logistics within it.

Top tip: Remember that complex products such as cars or technology products will have very complex supply chain rivers. More basic everyday products often have shorter and simpler supply chain rivers.

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This article is from the free online course:

Principles of Global Logistics Management

Coventry University