Production logistics

Production logistics tries to ensure that the transformation of supplies (merchandise, raw materials or supplies) passes from one phase of transformation to another efficiently until the achievement of the final product.

Production logistics

From the definition of production logistics, we can say very simply that, ultimately, it tries to optimize the part of the activity that is exclusively responsible for producing.

From the moment the supplies are received from the warehouse until they leave the production phase, they are managed by the production logistics department.

There are many companies that transform products in various phases. For example, to produce a car you have to build several parts and then put them together until you have the complete car.

Production logistics functions

The functions of production logistics are varied. However, without loss of generality, we could say that the main functions of production logistics are:

Optimize element transformation

Production logistics is not only limited to compliance with production protocols. In addition, a good department must try to ensure that production is optimal. Either analyzing possible new production processes or modifying existing ones.

The objective is to produce with the best quality / cost ratio. Where the cost also includes the variable time. After all, taking longer means a higher cost in salaries or supplies such as electricity.

Transport intermediate products to the next transformation phase

In companies that have several stages of production, it is treated with semi-finished products. Take, for example, a company that manufactures shoes:

It may be that part of the company is dedicated to manufacturing the laces. Of course, the business of the company is to make shoes, not laces. Therefore, the laces will have to be taken to another phase where they are added to the shoe. Until then, laces are semi-finished products.

Production logistics must see to it that the laces get to the right place at the right time and in the right quantity.

Ensure that the transformation following quality standards

More specifically, the department must monitor and control that quality standards are being met. These standards can be something unique to the company, or they are required by law to be able to market them.

An example of this are helmets for a motorcycle. We have all heard the term ‘approved’ at some time. For a case to be considered approved, it must meet a series of requirements. If it is not produced well, it could be withdrawn from the market. Despite, yes, that it has been distributed and marketed.

Prepare the final product to be distributed

Preparing the final product for distribution does not necessarily mean packaging it. From packing it, you can take care of the distribution logistics. However, it is recommended that the finished products be provided to the distribution party.

Let’s take an example of a company that makes cars. It is recommended that once the car is ready it is transported to an area, where those in charge of distribution can treat it properly.

Although there are many other functions, we could summarize it in the previously mentioned ones. It is undoubtedly a fundamental part where (in case of not being done well) it will be possible to incur higher costs and less quantity produced.