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This chain begins with the procurement of raw materials that are used in various products and ends when the finished product is delivered to either the retail store or the customer’s front door. In this article we are going to discuss the last leg of the supply chain, product distribution.
Logistics is the discipline modern companies rely on to ensure quick and efficient delivery of products. It does this by focusing on three essential processes–product storage, product transport, and supply chain management. At present, the most popular storage and shipping technique is called pick and pack fulfillment.
The pick and pack technique first became popular when large companies had to ship many different products to many different places. For the average business this process was a nightmare. It was time-consuming and extremely expensive. For a small business it was nearly impossible to achieve any kind of growth with the costs of order fulfillment constantly draining the operating budget.
Processing and shipping orders in house is expensive for businesses because there are too many pieces of the order fulfillment process for a business to perform consistently and efficiently when order processing is not the main focus of the business. Storage of products, processing orders, packing orders and figuring out shipping costs is too much work and has too high of a cost for a business whose primary function is to sell products.
Outsourcing the supply chain management of those products is the most cost effective way to keep customers happy and still focus on the business of selling items. Supply chain and logistical management lets warehouse managers and later workers know when it is time to remove the individual items from their bulk storage containers and place them on shelves.