Trade Logistics is a chain of series of links and interfaces with potential for value addition. The difference between the revenue earned by a business enterprise and the cost of bought-in materials, services and components, represent the value which a firm adds by the process of production. The value added concept is also important in that it helps in measuring productivity and profitability of an enterprise, its impact on the national economy and keeping in focus the sources of comparative advantage like logistics, marketing, sales and service.
Through optimization which is the essential function of logistics, many nations like new big economic nation India and China, also developed nation like USA and western European nations and Japan have benefited by :-
----- Selling service rather than remaining content with the price of exporting.
----- Simplifying documentation, customs clearance and payment formalities.
----- Offering varied choice of delivery terms.
----- Increase in the size of export orders.
----- Harnessing professionals knowledge and expertise to exercising model options, cost and time trade offs.
----- Proactive rather than reactive approach to international trade logistics.
Logistics plays a significant role in the developed economies with its importance growing pari pasu with the increase in the share of services as compared to manufacturing .