1. Unit 6: Logistics and the Supply Chain
Mrs. Brink Marketing Principles

2. Supply Chain
The supply chain encompasses the steps it takes to get a good or service from the supplier (producer) to the customer
Involves channel!
Managing the chain=logistics!

3. Choosing Transportation Methods
A huge part of logistics involves transportation!
Also called Physical Distribution
Railroads
Trucks
Ships and boats
Airplanes
Pipelines

4. Railroads Inexepensive Good for moving heavy products and large loads
Raw materials, industrial equipment, large shipments of consumer goods
Limited accessibility—must stay on the tracks
Slow

5. Trucks Quick! Can reach almost any location
Good for local shipments and across country
Can handle large or small shipments
Some manufacturers own their own trucks

6. Ships and Boats International distribution Can handle large shipments
Relatively inexpensive compared to other modes of transportation
Very slow

7. Airplanes The quickest form of transportation VERY EXPENSIVE
Smaller shipments use commercial planes, larger shipments use cargo planes
Good for products that spoil quickly or need special care

8. Pipelines Only used to transport resources
Oil, water, natural gas
Can transport resources over extremely long distances
Alaskan Pipeline
Very expensive to build and maintain

9. Storage and Product Handling
Storage is very important! Can help channel member to balance supply and demand
Warehouses
Distribution centers
Packaging

10. Warehouses Building designed to store large amounts of raw materials
Can be public or private
Public warehouses are smaller facilities
Private warehouses can be purchased to hold large quantities

11. Distribution Centers
Used to accumulate products from several sources then regroup, repackage, and send out
Large retailers have many of these
Walmart
Must be quick and efficient to cut back on storage and transportation costs
Amazon.com

12. Packaging Form of storage and promotion MUST PROTECT THE PRODUCT
Aids in effective transportation, storage and use of product
MUST PROTECT THE PRODUCT
Retail products—can distinguish from competition and give competitive edge