Supply Chain Management vs Logistics: Differences, Similarities and Roles

Supply Chain Management vs Logistics: Differences, Similarities and Roles

With the rise of online businesses, having efficient and well-informed supply chain management and logistics strategies has become increasingly important. It helps to ensure customer satisfaction and smooth running of business for Indian eCommerce merchants. But what is the difference between supply chain management (SCM) and logistics? When should an ecommerce business implement one over the other? How can both be used together to enhance operational efficiency? In this blog post, we will explore these questions in detail as we look at SCM vs Logistics – outlining differences, similarities, roles, and benefits. Furthermore, you will receive practical advice on how to incorporate both into your own operations for optimized performance. Read on to learn more about those subjects!

How is supply chain management significant for eCommerce businesses?

The role of supply chain management is highly important to the success of any eCommerce business. This critical aspect helps merchants streamline their operations, reduce redundancies, and increase profits by optimizing their supply chains. From maintaining warehouses that store incoming goods to ensuring orders get fulfillment centre on time and with minimum operational costs, it is essential for eCommerce businesses to have a reliable supply chain management system in place. This can include types of warehouses such as public, dedicated, or shared ones. Each type has its own set of advantages or disadvantages based on the size and nature of inventory needs. Moreover, this system should be fine-tuned constantly, taking into account changes in customer demand and other factors to ensure success in an ever-dynamic online retail marketplace.

How is logistics significant for eCommerce businesses?

Logistics are an integral part of the eCommerce landscape. Companies now rely on an efficient logistics process to ensure timely deliveries and keep customer satisfaction levels high. But it isn’t just the delivery that logistics deals with – the entire supply chain, from sourcing raw materials to production and distribution of products, is managed by logistics professionals.

Logistics professionals must stay abreast of current trends in order to coordinate shipping schedules, maintain inventory status and develop strategies for quickly responding to shifts in market demands. Combined with AI-driven automation, advanced analytics and predictive data analysis, a well-structured logistics process can yield major gains in order fulfilment accuracy and speed while also decreasing costs associated with delivery delays. Clearly, understanding the role of logistics in eCommerce is essential for companies who want to stay competitive in this ever-evolving digital era.

Similarities between supply chain management and logistics

• Coordination of resources in order to achieve a specific goal.

• Efficient movement of goods and materials in order to meet customer demand.

• The planning and execution of transportation and storage operations.

• Optimisation of the use of resources in order to minimize cost and maximize efficiency.

• Essential for the success of any organization that relies on the movement of goods or materials.

Differences between supply chain management and logistics

• Supply chain management involves the coordination of all activities from the raw materials stage through to the end customer, whereas logistics is focused on the transportation and storage of finished goods.

• Supply chain management includes both planning and execution, whereas logistics is primarily concerned with execution.

• Managing the supply chain encompasses the entire value chain, however, logistics is just one part of it.

• The goal of supply chain management is to optimize the overall performance of the value chain, and the goal of logistics is to optimize the transportation and storage of finished goods.

• Supply chain management requires a deep understanding of all aspects of the business, including marketing, sales, finance, and operations. On the other hand, logistics can be managed by those with less knowledge of the business as a whole.

• Supply chain management is a strategic discipline, but logistics is more operational in nature.

• A supply chain is concerned with managing relationships with suppliers and customers, and logistics is primarily related to transportation and storage.

Conclusion

By definition, logistics is a subset of supply chain management. Where SCM covers the entire process from acquiring raw materials to delivering the final product to the customer, logistics focuses on moving the finished goods through the supply chain until they reach the end user. A strong understanding of both concepts is necessary to ensure your business is able to get products to market quickly and efficiently while still maintaining high levels of quality control. Both are vital functions for eCommerce businesses where logistics companies like NimbusPost excel at. The tech-enabled shipping aggregator has a wide network of 540+ warehouses within India and 30+ warehouses in the international market to facilitate easier, inexpensive and faster delivery of orders. Do you have a partner to manage your supply chain management and logistics? If not, you may want to connect with NimbusPost!