What is the Supply Chain and how does it differ from logistics? - Authorized Movers

What is the Supply Chain and how does it differ from logistics?

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We often talk about logistics and Supply Chain as synonyms: this is not quite correct. Yes, these are two very similar concepts, which complement each other. But their basic meanings are different. This can be said based on what each covers: supply chain is a category that includes logistics, but also other parts. In this note, we’ll explain the differences between these two terminologies, with a detailed description for each.

Supply chain and logistics: essential differences

With the word “Logistics“We want to refer to the processes of purchasing and delivering products or raw materials. This process includes questions such as packaging, the storage, the Shipping and the transport goods.

On the other hand, with Supply Chain we are aiming for a wider field. Its translation into Spanish is “Supply ChainAnd maybe you’ve read it in other notes on this blog. It is, precisely, a chain, because it has many actors or connections that make it up. These are all individuals, organizations, resources, activities and technology launched in the distribution of a product. In other words, it encompasses from the arrival of raw materials from a supplier to a manufacturer, right through to the hands of the end customer.

Supply Chain

So, we can see that logistics are part of the supply chain. Perhaps the most important, but still does not cover all chain. We see it above all at the time of management: It is not the same thing to take care of the whole process, as only one part (logistics).

But then … what is logistics?

To begin with, we can distinguish logistics internal or external. In the first case, we refer to the tasks related to the acquisition of materials, their handling, their storage and their transport.

Moving on to the second, we find instances of collection or To recover, transfer and supply of products to the customer. In this logistics we must have good planning and preparation of orders. the long-distance freight transport it is a complex task that requires special care to achieve good results. This is, the best moments at the lowest cost.

Dedicated logistics companies provide their services to manufacturers, retailers and other industries that need to transport goods. Thus, we see that sometimes this transport requires different modalities.

For example, during an internal transfer or to neighboring countries, the road logistics. That is, they are made available to transport the product, trucks and vans. Other distances, for example from America to Europe, require a maritime logistics. However, this often requires road supplementation. One truck will transport the merchandise to the port of origin and another will pick it up at its destination.

The logistics processes can be totally or partially outsourced. Thus, some responsibilities may be left to the logistics company (for example, only transport). Or the whole operation can be delegated to these companies. This way you don’t have to worry about the management and you can fully devote yourself to yours. Currently, the sector is growing, becoming one of the sectors that hire the most professionals.

Supply chain

With the English term “Supply Chain“It aims to name all the actions involved in the integration of all the activities of a supply chain. that is to say, he seeks management with a global vision of the life of a product. We said that this is the biggest difference with logistics, which only manages part of the chain, with a single player: the logistics provider.

The goal of logistics is customer satisfaction quickly, safely and affordably. The supply chain, for its part, has the plan to gain competitive advantage. Looking at the whole process, you see how much can be improved to achieve a lower end price, and therefore more sales. The main supply chain functions they are:

  • Purchases. Coordination with suppliers for the acquisition of raw materials and other resources for manufacturing.
  • Operations. Planning, forecasting and anticipation of stock demand.
  • Logistics. Work hand in hand with the logistics provider.
  • Resource management. Distribute resources, manage more or less presence according to the needs of each link.
  • Information. It is responsible for the exchange of information on all the processes covered by the supply chain.

Supply Chain

Some conclusions

the Supply Chain, then, this is the name by which the total management of a process is known. Within its parts, logistics play a central role. They are different types of logistics operators, and Tradelog, we are always ready to establish the strategy that best suits your needs. Leave us your question in the comments and let’s get to work!

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