Distribution logistics
Distribution Logistics – Tasks and Objectives
The primary task of distribution logistics is to plan, control, and execute the flow of goods efficiently. This includes transport planning, warehousing, order processing, packaging, picking, and handing over products to carriers or end customers. The overarching goal is to ensure a smooth, cost-efficient, and customer-oriented flow of goods.
Key objectives include:
- Ensuring delivery capability and meeting promised delivery times.
- Optimizing transport costs through intelligent route planning and shipment consolidation.
- Increasing warehouse process efficiency using modern picking and IT systems.
- Minimizing inventory without compromising supply.
- Enhancing customer satisfaction through reliable and transparent delivery processes.
Professional distribution logistics significantly strengthens a company’s competitive position.
Core Processes in Distribution Logistics
Distribution logistics is divided into several cross-functional areas:
- Order and Order Processing: Customer orders are received, verified, and forwarded to the warehouse. Fast information flow is essential.
- Storage and Inventory Management: Even with lean concepts like cross-docking, efficient warehouse organization remains crucial. Inventories must be accurately maintained and optimally sized.
- Picking: Products are assembled according to customer orders. Automated systems, pick-by-voice, or pick-by-light technologies can improve efficiency.
- Packaging and Shipping Preparation: Goods are securely packaged, labeled, and prepared for onward transport.
- Transport and Delivery: This includes selecting suitable transport modes (road, air, sea, rail), route planning, and handover to carriers, parcel services, or company fleets.
This process chain largely determines how quickly and reliably a company can serve its customers.
Importance of Modern IT Systems in Distribution Logistics
Digital systems such as Warehouse Management Systems (WMS), Transport Management Systems (TMS), real-time tracking, and ERP solutions are indispensable today. They enable transparent information flows, automated process steps, precise inventory management, and efficient utilization of transport capacity.
Especially in global supply chains, IT systems support compliance with complex regulations, route optimization, and tracking key performance indicators (KPIs) such as delivery reliability, lead times, and freight costs.
Challenges in Distribution Logistics
Distribution logistics faces numerous challenges driven by competition, globalization, and changing customer behavior, including:
- Increasing expectations for delivery speed (same-day or next-day delivery).
- Fluctuating demand, particularly in e-commerce.
- Rising costs for energy, labor, and transport capacity.
- Complex international regulations, e.g., customs, export control, or supply chain compliance.
- Sustainability requirements, such as CO₂ reduction or the use of alternative drives.
Companies must respond flexibly by leveraging modern technologies, building efficient logistics networks, and forming strategic partnerships with carriers or contract logistics providers.
Role of Distribution Logistics in the Supply Chain
Distribution logistics serves as a process-oriented link between production and the market. It affects the efficiency and performance of the entire value chain. Companies with well-organized distribution logistics can increase service levels, reduce costs, and secure their market position in the long term.
In global markets, where supply chains are increasingly complex and dynamic, distribution logistics is one of the st