Marketing logistics (also called physical distribution) refers to the planning, implementation, and control of the efficient flow of goods, services, and related information from the point of origin (manufacturer) to the point of consumption (customer) in order to satisfy customer requirements profitably.
- It is also defined as the process that has the responsibility to ensure the delivery of the right product, at the right place and at the right time and in right condition.
It includes all the activities involved in:
- Transporting goods
- Storing inventory
- Managing stock levels
- Processing orders
- Delivering customer service
Objectives of Marketing Logistics:
- Ensure Timely Delivery
- Provide Product Availability
- Minimize Distribution Costs
- Improve Customer Service
- Enhance Market Reach
Components of Marketing Logistics:
1.) Transportation:
Transportation is the physical movement of goods from one location to another (e.g., from warehouse to retailer or directly to the customer).
Key Modes of Transport:
- Road – Most common, flexible for short and medium distances.
- Rail – Cost-effective for bulk and heavy goods.
- Air – Fastest, ideal for urgent or perishable goods but expensive.
- Water – Useful for international shipping and bulk goods.
Importance:
- Ensures timely delivery
- Affects product availability
- Influences logistics cost and service quality
2.) Warehousing:
Warehousing is the storage of goods until they are needed for sale or delivery. It helps balance the gap between production and consumption.
Types of Warehouses:
- Private Warehouse: Owned and operated by a company for its own use.
- Public Warehouse: Available for use by many businesses; rented space.
- Bonded Warehouse: Stores imported goods until customs duties are paid.
Importance:
- Maintains stock levels
- Helps in bulk breaking
- Acts as a buffer between production and demand
3.) Inventory Management:
Inventory management involves controlling the amount of product a business holds at any time. It balances between too much inventory (which increases cost) and too little (which risks stockouts).
Key Activities:
- Tracking stock levels
- Setting reorder points
- Forecasting demand
Importance:
- Avoids overstocking and understocking
- Reduces holding costs
- Improves order fulfillment rate
4.) Order Processing:
Order processing refers to the steps taken to fulfill a customer order, from the moment it’s received until it is delivered.
Steps Include:
- Receiving the order
- Checking stock availability
- Picking and packing the products
- Shipping and tracking
Importance:
- Ensures accurate and timely delivery
- Enhances customer satisfaction
- Reduces errors and delays
5.) Customer Service Decisions:
Customer service decisions relate to how a business supports and interacts with customers during and after the purchasing process.
Key Elements:
- Delivery time and accuracy
- Easy return and refund policies
- Responsive complaint handling
- After-sales support
Importance:
- Builds customer trust and loyalty
- Enhances brand image
- Encourages repeat purchases
