What is Logistics Management?
Logistics Management is a component of supply chain management that allows a company to handle the planning and implementation of all the processes put in place to ensure proper and effective flow and movement of goods and information from one point to another.
A company’s logistics management caters to functions like transport, warehousing, fleet management, inventory control, and handling of third-party logistics.
Under logistics management you are also likely to find the following aspects of supply chain management:
- Product sourcing and procurement
- Assembly and packaging of goods
- Customer service
Other elements of logistics management include identifying and utilizing software and technology to achieve efficiency and satisfy customers.
Why is it important for a company to have an effective logistics management team?
You only have to look at your customers: if they are satisfied with the service, then it means the company’s logistics ensured delivery was timely, safe and cost-effective. This translates into more customer satisfaction which in the long run shows in a company’s reduced cost of doing business as well as profit.
What Are the Duties of a Logistics Manager?
Typically, a logistics manager works as the main supervisor in charge of a company’s logistics teams. The logistics manager’s duties include creating a budget for the department and coordinating logistics functions to fit an approved budget.
One of the main roles in this position is to ensure the efficient movement of goods through a company’s supply chain. Here, their duty includes examining and analyzing company orders for inbound or outbound shipment.
Duties also include creating and overseeing the execution of all the procedures that help optimize product and information flow. The aim is to ensure timely delivery of materials from source points or goods to end-users. These efforts are targeted at cutting the overall costs of operations for the company or organization.
A Logistics Manager also has the responsibility of identifying and selecting suitable vendors and providers as well as negotiating provision of these services.
Overall, a logistics manager works under a senior manager to oversee transportation logistics, freight delivery, storage, and inventory control. The Logistics Manager also receives various reports from junior officers and delivers the same to senior executives in operations.
Apart from holding supervisory roles, logistics managers will often be tasked with making day-to-day operations involving junior staff, including reviewing staff performance, scheduling work and hiring to fill vacancies.
As a logistics manager, you are likely to juggle working from an office and doing fieldwork that includes visiting storage facilities.
What Are the Average Salaries of a Logistics Manager?
The average salary for a logistics manager in the U.S. is $65k per year, which can rise considerably given employees also enjoy various other perks like bonuses, commissions, and profit-sharing.
Research by Payscale.com shows that on average, a logistics manager will get $4.6k in bonuses, $10k as commission and about $3k from profit sharing. The lowest-paid logistics managers account for 10% of positions and earn on average $43k per year. The top 10% earn on average $97k but the range varies from $90- $120 per year.
By comparison, logistics managers in the U.K. earn an average entry-level salary of £25,000. The pay can rise with rank and experience to reach over £69,000 per year.
Across the globe, the logistics manager’s salaries typically vary depending on several factors. In most cases, a logistics manager’s salary will depend on factors like level of education and courses, skills set, and experience.
Logistics managers who earn higher pay have professional skills related to Logistics, Supply Chain, and Operations Management. Low paying positions are those with skills in Inventory Control, Microsoft, Customer Service, and Shipping.
Entry-level logistics managers earn an average of $48k inclusive of all other perks. Moving up the experience ladder will see you take home on average $59k if you have a job experience of 1-4 years. Earnings increase with experience to top an average of $76k for Logistics Managers with over 10 years’ job experience.
Here are some of the popular salaries for logistics manager in the U.S. (all salaries are an average annual base pay):
- U.S. Army and U.S. Navy – $75k per year
- The U.S. Air Force (USAF) – $73k per year
- Ryder Integrated Logistics Inc -$62k per year
- Amazon.com Inc – $60k
- DSC Logistics – $57k per year
- Walmart – $52k per year.
Which Sectors or Industries Employ the Most Logistics Managers?
Most logistics managers work for companies that provide services in freight and transportation, warehousing and product distribution. In the U.S., the federal government ranks as one of the biggest employers of logistics managers.
In the U.S., logistics managers in Dallas, Texas; Los Angeles, California; and New York earn higher salaries at 6.0%, 4.9% and 5.3% above the national average respectively.
What is the Difference Between Logistics and Logistics Management?
Logistics broadly refers to the process of planning and coordinating the movement of goods, materials, inventory, and people from one point of origin to another.
Logistics activities include handling processes like packaging, freight transportation, and warehousing.
Logistics management, on the other hand, is a function of the wider supply chain management that allows for the managing and implementation of a company’s logistics.
A company or organization relies on effective logistics management to handle its operations, right from the planning of activities to their proper and timely execution. While logistics will put in place mechanisms to handle things like product sourcing, transport, packaging and warehousing, logistics management will allow for the coordination of these programs.
Logistics management also incorporates many other activities of a company that normally would be handled under separate departments. In this way, logistics management allows for a scenario where a company can integrate its sales and marketing operations with other functions like transport.
Proper logistics management also allows for effective handling of reverse logistics. This is where a company can efficiently handle all the processes involved in returning goods from the end-user to the company.
How Do You Become a Logistics Manager
Generally, you need to have a bachelor’s degree in logistics management, operations, business management or supply chain management and related fields of study to be employed as a Logistics Manager.
Higher qualifications include graduate degrees in the related field. Most companies require that applicants for a logistics manager’s job be experienced in operational work involving freight management, warehousing, shipping, and other management tasks.
Typically, an applicant for a logistics manager’s job should have 5-10 years’ working experience in a logistics position. Some employers will go for candidates with at least three years’ experience in management, preferably in logistics or supply chain management.
Other than the said experience in logistics, you may need to acquire professional certification from relevant bodies like the International Society of Logistics or American Society of Transportation and Logistics.
Begin by pursuing a relevant course that leads to the position of a logistics manager, and works to become highly knowledgeable about logistics management.
Are There Logistics Management Courses?
Numerous courses are geared toward careers in logistics management. You can opt for an associate’s, bachelor or graduate degree programs in logistics, business management, and supply chain management.
Other courses of study are related to fields like accounting, business law or business economics, and computing programs.
Courses equip learners with skills in both domestic and international logistics covering key fields of:
- Maritime logistics and shipping management
- Transportation logistics
- Product distribution
- Supply chain
- Warehouse management
- International shipping and handling logistics
Specifically, Logistics courses introduce study subjects that help students internalize planning and effective execution of logistics approaches.
Supply Chain Strategy courses offer an opportunity for business logistics and management with real-life situations.
Inventory Management courses allow for the development of skills necessary for handling and control of inventories. It includes being able to analyze and determine points of weakness in inventory and logistics.
International Logistics offers courses related to import and export regulations and related laws. The global economic environment, customs, and tariff systems are also covered, with emphasis on how logistics impact international trade.
Logistics Management courses for a Bachelor’s Degree
If you take logistics courses for your Bachelor’s degree, then you could study such subjects as:
- Logistic strategy
- Transport logistics laws and regulations
- Distribution channels
- Logistics software and technology
- Inventory management
Courses for Master’s Degree in Logistics Management
Do you want to pursue a higher qualification in logistics management? You can take courses leading to a Master of Science degree in Logistics and Supply Chain Management.
Apart from diving deeper into aspects like research, you could further your grasp of the logistics course by studying:
- Global logistics
- Lean enterprise management
- Purchasing strategies
What is Supply Chain?
The term supply chain refers to a collective process that incorporates companies, resources, people and technology and by which raw materials move from the source to the manufacturer and the product from the manufacturer to the end-user.
In simple terms, a supply chain is an established network that involves the production of goods or items, beginning right at the point where we get raw materials to a finished product delivered to a customer.
A supply chain caters to the entire production process, tracking the movement of materials and resources from suppliers to factories and finished products to the final consumer. The distribution channel is that part of a supply chain that involves the movement of goods from a manufacturer to a consumer.
That aspect of a supply chain that monitors the flow of materials, finances, and information is known as supply management (SCM).
A supply chain management program makes it easy for a company or companies to coordinate the flow of the above aspects. It also integrates logistics, which allows for planning and executing the activities that facilitate production and distribution.
The various stages of a supply chain constitute a specific industry that works with others within the broader chain. As such, extraction of raw materials forms a distinct component of the supply chain, as is manufacturing, shipping, trucking, warehousing, and inventory.
Of what value is Supply Chain Management (SCM) to companies?
Supply Chain Management typically tries to have all process involved in product manufacture, shipment, storage and distribution linked under one network.
Proper management of a supply chain helps a company to cut unnecessary or excess costs while ensuring that products get to their destination or consumer safely and on time.
Companies employ Supply Chain Managers who coordinate the given company’s supply chain logistics. The duties of a Supply Chain Manager include overseeing:
- Planning and strategy
- Oversight over the supply of raw materials
- Company manufacturing logistics
- Product delivery and logistics
- Report on reverse logistics
Companies that coordinate the supply chains effectively benefit from increased efficiency in production.