Logistics Costs

The Cost Structure show a striking uniformity . Logistics adds value , the basic assumption beaning that trade offs exits within the system and surface when conscious attempts are made of optimize the system . Trade off are therefore central to logistics and provide the raison d'etre for total distribution cost approach with characterizes modern Logistics  Management .

Logistics Cost would ordinary include items such as :-

1) Packaging
2) Mateial Transfer
3) Marking the Trade offs of goods identifiers
4) Stacking/Unstacking
5) Storage/Warehousing
6) Consolidation/De-consolidation
7) Transport activities all modes
8) Time value for investments in goods in the Logistics System including the added value of  Transportation ,    Storage and Handling .
9)  Physical  form changes required for effective and/or safe Transport , Storage and Handling .
10) Marking , identification , recording , analysis , data transfer and handling .
11) Electronic data integration .
12) Logistics System Management .

The cost of non-physical handling and transport activities , such as inventory and related time costs and the costs of data  acquisition , handling , transfer and use often account for major share of Logistics Cost . The technological changes in logistics system triggered by advances in information and communication systems , have helped in reducing the time of moving goods from origin to destination . This has helped not only in reducing the time for transport handling and storage but also in packaging and related from changing activities . Thus Logistics is concern with making the product available in the right form , at the right place and at the right time  at least cost and intermodalism plays a significant role in the business . In developing economies like India and China efficient Logistics Management will contribute to GNP through value addition and also help in promoting foreign exchange earnings/savings through , aggressive promotion to exports , use of national shipping freight forwarding and under - writing by national insurance Cos . A logistics divine approach  to export would include manufacturer/exporters to take control of processing and distribution functions to add value to a product and at the same time ensure its delivery to the end user within the stipulated time . Another important spin off benefits of logistics is that it facilitates examination of policy options from the system rather then sectoral standpoint . Multimodalism also demand a systems  approach and modal intervention makes this possible .

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