Why Logistics Companies Rarely Go Out Of Business

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Why Logistics Companies Rarely Go Out Of Business

Despite the state of the economy, goods have to move from one point to another. That’s the secret behind the perennial health of Canadian logistics companies. However, all logistics companies are not the same. Some incorporate a perfect blend stellar services, technology and innovation in their daily activities to keep their sales soaring higher and higher while maintaining a smooth flow of the local and international supply chain. Logistics providers have in the last couple of years created over 1600 jobs in the Canadian economy and chipped in over 400 million Canadian dollars to the country’s GDP. Interestingly, the distribution and manufacturing sectors of the industry which the logistics sector relies on, were hit hard.

What Exactly Does A Logistics Company Do?

Logistics firms specialize in the management of the flow of goods from one point to another. These are the companies that make sure that the raw materials get to the factory and the end product gets to the end consumer. The logistics company handle the security, packaging and warehousing, inventory and all the shipping functions for the consignment.

The Relationship between Logistics and Supply Chain

There is no logistics without supply chain. They go hand in hand. Every business, no matter the scale of its operations, has a supply chain. Think of any simple type of business, for instance, a lemonade stand. All the commodities required to put the end product on the hands of the customer; cups, sugar, lemons that the owner had to get from the grocery store, put them in a cart and drive home. Don’t forget he had to stop by a home improvement store to obtain the materials to put together the stand. At home, he had to make ice and mix the lemonade, and finally for customer attraction purposes, he had to put a signed poster board out front. That describes the supply chain of a lemonade stand. The logistics part of the business is represented by a perfectly-devised coordination of every step.

The Importance of Logistics to Every Company

All businesses need logistics. Logistics can be simple or complicated depending on the size and nature of the business. In a business setting, logistics can be either inbound or outbound, meaning they can have an internal or an external focus. Every entrepreneur can tell you how they deal with reverse logistics in the form of denial of services or returned commodities. Small firms also use warehousing and inventory to conduct distribution logistics. Other smaller logistics activities many small businesses deal with include the transit of merchandise to a store and finding suppliers. Large enterprises deal with all the above logistics fields. As the business gets bigger, the logistics become more complex and that’s where logistics companies come in. The 3PL Links is a useful source for more information and insights.

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