Today's logistics and distribution are quite complicated systems, but they emerged long ago in much less advanced forms. A brief look at the history of logistics can reveal a lot to us.
In addition to being crucial to economic growth, logistics is a critical success factor in any industry. In the shipping and transportation sector, it is a significant part of the business.
Logistics is defined as the effective planning and implementation of information, products and services in the supply chain. From start to finish, logistics support the supply, storage and control of materials and information between suppliers and customers.
Logistics refers to the movement and transport of products or services to a specific place at an agreed time and the lowest cost. The ancient Roman, Greek and Byzantine wars are the foundation of today’s logistics systems.
The Roman Empire developed a very efficient logistical system to supply its legions. Military officers called "logistikas" were responsible for securing supplies and allocating funds so that soldiers could advance effectively.
History of logistics
During the Middle Ages, more elaborate supply, road and warehouse systems were used. Forts and castles became warehouses supported by the economy of the surrounding villages. During the Industrial Revolution, logistics advanced significantly with the development of railways and ships.
Logistics is a relatively young science, but the evidence for its application dates back to 1670 and is related to the army's supply. Proof of this is the military documents of Ludwig XIV, who used logistics to supply and transport weapons, food and equipment to his military troops.
World War I further boosted industrial capabilities. The internal combustion engine helped develop motor transportation. During World War II, logistics developed even faster. The military logistics of the United States and its allies proved to be too much for the German army.
The U.S. military ensured that supplies were provided to their soldiers at the right time in the right place, while the German military had significant supply problems. Also, the U.S. has sought to provide these services optimally and most economically possible.
The best available options for performing logistics tasks have been developed. Several military logistics techniques were developed that are still in use but in more advanced forms.
After World War II, logistics shifted from warfare to business. Product distribution, warehousing, production planning and customer service are fundamental aspects of logistics processes today.
In the middle of the 20th century, logistics entered the economic-scientific field. It came to the countries of Western Europe in the 1980s, at a time when the supply of goods could not keep up with demand.
Chronology of logistics development:
logistics played a crucial role in victories during the ancient Roman, Greek and Byzantine wars
France, 17th century: logistics as a military doctrine in the supply of the army with the necessary means, food and weapons
1844, French engineer Jules Dupuit: the idea of replacing transportation costs with inventory costs.
USA, late 19th century, logistics introduced into military literature
In the middle of the 20th century, the term entered the economic-scientific field.
It is believed that the development of modern logistics began in the 1960s when better integration of corporate organizational functions sought to reduce costs.
In 1961, the first book in the field of business logistics focused on physical distribution.
In the second half of the 20th century, logistics affirmed itself as a science and economic activity in a much broader and more subtle sense.
The importance of logistics for successful business
The whole industry arose from moving products from point A to point B. Many companies now rely on “outsourcing” for some or all of their supply chain management activities, resulting in the development of “third-party” logistics companies to efficiently transport and track goods.
Logistics has significantly evolved throughout history. A logistician performs his duties and responsibilities based on his education, skills, previous experiences and even intuition.
These skills are nurtured by the pursuit of continuous improvement of business organizations. The logistician ensures that the company benefits from an efficient logistics management system. It is crucial to ensure the provision of products and services on time and at an affordable price.
Understanding the importance of logistics for the overall success of a company is crucial for business leaders. Companies need to hire logisticians with adequate knowledge to ensure sustainable improvements in supply chain management.
The main focus of logistics in the early 1960s, and especially during the economic recession of the early 1970s, was a careful look at the mechanisms that would help optimize processes and improve risk management systems and techniques.
The introduction of computing in the 1980s took logistics to a whole new level, brought tremendous progress and revolutionized the supply as we know it today.
What did globalization in the 1990s bring?
The 1990s turned the entire logistics ecosystem upside down and brought innovative operating schemes, better understanding and expectations of customers, digital channels, greater productivity and functionality.
With the rise of globalization in the 1990s, companies began to import and export exponentially. Transportation became an important factor in doing business when it came to cost and time efficiency.
During this period, companies were in competition with each other over who would deliver the goods in record time. This era of globalization shaped today’s logistics.
The second half of the last century played an essential role in the history of logistics. The cycle continued with the emergence of e-commerce and the digitalization of the global market.
Logistics development over the years has brought many advantages and opportunities:
New product development
More innovation
New sources of income
More dynamic, safer and more interactive supply chains
Improved access to real-time data and information
More agile and efficient processes and operations
Increased control, visibility and collaboration
Making decisions more efficiently
Improved response to market conditions (elastic logistics)
Faster options for planning and executing operations
Reduced time to market products
Better service and customer satisfaction
Logistics today
As we know it today, the logistics are much more in line with freight transport's commercial side. Regardless of countries, states and distances, logistics is present in some form anywhere.
The 21st century has brought a lot of novelties to the world of logistics. With new, fast and efficient technologies, logistics is improving year by year. As a result, we see a complete and complicated process. Logistics has truly become an art in the culture of economics.
Logistics has developed more in the last twenty years than in all of history and has become an essential factor in a country’s economy.
Customer demand for tracking and delivery speed has never been higher, and customer expectations affect every part of the supply chain.
Equally, logistics delivery and management solutions make global supply chains smarter, faster, more sustainable, and customer-oriented.
Factors that influenced the accelerated development of logistics:
globalization and concentration of economic activities
internationalization of production and trade
strengthening competition
accelerated development and modernization of transport infrastructure and transport technologies
increase in purchasing power
strengthening democratization
Transformation of traditional logistics
Since the beginning of e-logistics, traditional logistics has seen a steady decline in customers and users. It was an incentive to adopt more cost-effective and efficient e-logistics systems and adapt existing systems accordingly.
Supply chain cooperation is a burning issue today. Companies that use innovative digital solutions for effective collaboration across the supply chain are aware of their significant business advantages. Some of the advantages are:
Cost reduction up to 35%
Up to 50% lower carbon footprint
Increased prediction accuracy (up to 25%)
Stock reduction up to 20%
Up to 10% reduction in the administrative workforce
Improved level of service and customer satisfaction
The future of logistics lies in digital supply networks, and digital logistics will continue to grow in the next few years.
Efficient 21st-century logistics processes
Nowadays, logistics companies are increasingly integrating sustainable development goals into their business. One of the crucial factors today is the care for the environment, i.e., business and society's overall sustainability.
The industry is turning to green logistics, i.e., green/sustainable supply chains, to reduce the environmental burden of transport and supply chains.
The advantages of integrating sustainability into supply chain management are:
strengthening the company's reputation
reducing supply chain costs in the long run
increasing product and process innovation, which generates additional sources of revenue
increased customer loyalty
Elastic logistics is a new concept in the logistics environment. It refers to the possibility of expanding and reducing the logistical capabilities to comply with the requirements of any situation within the logistics operation. Elastic logistics allows companies to deliver goods on time, with the lowest possible costs, regardless of the increase in demand.
This has brought with it many advantages:
Increases user experience
Real-time supply chain reviews
Connecting all business processes
Providing agility and scalability of service
As advances in transportation and logistics technology continue to evolve, innovative leaders in the supply industry embrace these options and network their operations within open logistics networks. In this way, they meet the expectations of their customers and improve their position in the market.
How to improve the performance of your logistics?
No matter what the future holds, logistics will continue to play a significant role in our lives. As the supply chain becomes increasingly essential, logistics companies provide a range of service solutions, from planning to inventory management.
Logistics is often cited as the sector that benefits most from digitization. From social media to chatbots and e-commerce platforms, customers have greatly facilitated contact with vendors.
Nowadays, it is imperative to provide timely, professional and informative customer support to clients worldwide.
The Hubbig digital platform combines several transportation methods and logistics to help its customers operate successfully and thrive in an ever-changing global landscape.
It is essential to combine new technological capabilities and provide a quality freight transport service, to survive in a competitive market.
Have you tried the Hubbig app and felt the ease of fast and safe shipping of your goods?