{"id":8229,"date":"2023-01-29T16:44:47","date_gmt":"2023-01-29T15:44:47","guid":{"rendered":"https:\/\/lgigroup.com\/?post_type=glossary&#038;p=8229"},"modified":"2024-03-01T16:36:13","modified_gmt":"2024-03-01T15:36:13","slug":"procurement-logistics","status":"publish","type":"glossary","link":"https:\/\/lgigroup.com\/uk-en\/glossary\/procurement-logistics\/","title":{"rendered":"Procurement logistics"},"content":{"rendered":"            \r\n        <div class=\"spacing-block large spacing-block-id-69d1385618741\" >                                     \r\n                  <div class=\"large-space\">   \r\n                  <\/div>                      \r\n        <\/div>\n\n\r\n                <div class=\"headline-block \">\r\n                    \r\n                        <div class=\"container\">                            \r\n                            \r\n                            \r\n                            <div class=\"row\">\r\n                                <div class=\"col\">\r\n                                    <h1 class=\"wt-h1 wt-font-color-dark-grey\">Procurement logistics<\/h1>\r\n                                <\/div>                                        \r\n                            <\/div>                                                                                                    \r\n                        <\/div>                                \r\n                <\/div>\r\n            \n\n            \r\n        <div class=\"spacing-block extrasmall spacing-block-id-69d138561893c\" >                                     \r\n                  <div class=\"extra-small-space\">   \r\n                  <\/div>                      \r\n        <\/div>\n\n   \r\n    \r\n    <div class=\"grey-line-block grey-line-block-id-69d1385618a03\">\r\n        \r\n        <div class=\"container\">\r\n            <div class=\"row\">\r\n                <div class=\"col test\">\r\n                    <div class=\"grey-line-block-line\"><\/div>\r\n                <\/div>                \r\n            <\/div>\r\n        <\/div>\r\n        \r\n    <\/div>\n\n            \r\n        <div class=\"spacing-block small spacing-block-id-69d1385618ac7\" >                                     \r\n                  <div class=\"small-space\">   \r\n                  <\/div>                      \r\n        <\/div>\n\n\n<div class=\"wp-block-group container\"><div class=\"wp-block-group__inner-container is-layout-constrained wp-block-group-is-layout-constrained\">\n<p>What is the definition of procurement logistics? It is the link between the suppliers and the procuring company. Procurement logistics ensures that a company is supplied with all the necessary items in a needs-based and economical manner. This includes cost-optimised purchasing and the provision of materials in the right quantities &#8211; purchasing and warehouse logistics are key elements of procurement logistics.<br>Professional procurement logistics is essential in order to survive in international competition.<\/p>\n\n\n            \r\n        <div class=\"spacing-block small spacing-block-id-69d1385618c56\" >                                     \r\n                  <div class=\"small-space\">   \r\n                  <\/div>                      \r\n        <\/div><\/div><\/div>\n\n\n\r\n                <div class=\"headline-block \">\r\n                    \r\n                        <div class=\"container\">                            \r\n                            <div class=\"row\">\r\n                        <div class=\"col\">\r\n                            <h2 class=\"wt-subheadline wt-sl\">Task of procurement logistics<\/h2>\r\n                        <\/div>\r\n                    <\/div>\r\n                            \r\n                                                                                                                                \r\n                        <\/div>                                \r\n                <\/div>\r\n            \n\n            \r\n        <div class=\"spacing-block doublesmall spacing-block-id-69d1385619cf7\" >                                     \r\n                  <div class=\"double-small-space\">   \r\n                  <\/div>                      \r\n        <\/div>\n\n\n<div class=\"wp-block-group container\"><div class=\"wp-block-group__inner-container is-layout-constrained wp-block-group-is-layout-constrained\">\n<div class=\"wp-block-columns is-layout-flex wp-container-core-columns-is-layout-9d6595d7 wp-block-columns-is-layout-flex\">\n<div class=\"wp-block-column is-layout-flow wp-block-column-is-layout-flow\">\n<p>The well-known logistics principle of the &#8220;six R rule&#8221; is particularly effective in procurement logistics:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Right materials<\/li>\n\n\n\n<li>Right quantity<\/li>\n\n\n\n<li>Right quality<\/li>\n\n\n\n<li>Right place<\/li>\n\n\n\n<li>Right time<\/li>\n\n\n\n<li>Right costs<\/li>\n<\/ul>\n\n\n\n<p>These &#8220;six right things&#8221; form the backbone of optimised procurement logistics.<\/p>\n<\/div>\n\n\n\n<div class=\"wp-block-column is-layout-flow wp-block-column-is-layout-flow\">\n<p>The procurement process itself involves numerous tasks and organisational processes. The most important are:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Selection and filling of storage containers<\/li>\n\n\n\n<li>Interim storage<\/li>\n\n\n\n<li>Sorting and picking the goods<\/li>\n\n\n\n<li>Optimisation of purchase prices<\/li>\n\n\n\n<li>Optimisation of storage costs<\/li>\n<\/ul>\n<\/div>\n<\/div>\n<\/div><\/div>\n\n\n\r\n                <div class=\"headline-block \">\r\n                    \r\n                        <div class=\"container\">                            \r\n                            <div class=\"row\">\r\n                        <div class=\"col\">\r\n                            <h2 class=\"wt-subheadline wt-sl\">Methods of procurement logistics <\/h2>\r\n                        <\/div>\r\n                    <\/div>\r\n                            \r\n                                                                                                                                \r\n                        <\/div>                                \r\n                <\/div>\r\n            \n\n            \r\n        <div class=\"spacing-block doublesmall spacing-block-id-69d138561a911\" >                                     \r\n                  <div class=\"double-small-space\">   \r\n                  <\/div>                      \r\n        <\/div>\n\n\n<div class=\"wp-block-group container\"><div class=\"wp-block-group__inner-container is-layout-constrained wp-block-group-is-layout-constrained\">\n<div class=\"wp-block-columns is-layout-flex wp-container-core-columns-is-layout-9d6595d7 wp-block-columns-is-layout-flex\">\n<div class=\"wp-block-column is-layout-flow wp-block-column-is-layout-flow\">\n<p>Various methods and procedures are used in procurement logistics, from analysis to procurement itself. For example, just-in-time or just-in-sequence delivery, the KANBAN method, different supply models such as the regional forwarder concept and various procurement strategies. One of these strategies is single, dual or multiple sourcing, i.e. the sourcing of procurement objects from one, two or more suppliers.<\/p>\n\n\n\n<p>Single sourcing has the advantage of more favourable purchase prices due to the purchase of larger quantities. In addition, the exclusive co-operation creates a familiar partnership relationship, which can result in preferential treatment, for example in the event of supply bottlenecks. The disadvantage is a certain degree of dependency; delivery problems can lead to production stoppages.<\/p>\n<\/div>\n\n\n\n<div class=\"wp-block-column is-layout-flow wp-block-column-is-layout-flow\">\n<p>Dual or multiple sourcing makes it possible to utilise market conditions and competition from different suppliers to one&#8217;s own (price) advantage. You remain flexible and independent. However, this procurement variant requires an increased amount of information and communication, and with lower purchase quantities per supplier, the conditions could be worse than with single sourcing. The right strategy must therefore be chosen depending on the industry, production, market situation and many other factors.<\/p>\n<\/div>\n<\/div>\n<\/div><\/div>\n\n\n\r\n                <div class=\"headline-block \">\r\n                    \r\n                        <div class=\"container\">                            \r\n                            <div class=\"row\">\r\n                        <div class=\"col\">\r\n                            <h2 class=\"wt-subheadline wt-sl\">Procurement logistics with LGI <\/h2>\r\n                        <\/div>\r\n                    <\/div>\r\n                            \r\n                                                                                                                                \r\n                        <\/div>                                \r\n                <\/div>\r\n            \n\n            \r\n        <div class=\"spacing-block doublesmall spacing-block-id-69d138561af03\" >                                     \r\n                  <div class=\"double-small-space\">   \r\n                  <\/div>                      \r\n        <\/div>\n\n\n<div class=\"wp-block-group container\"><div class=\"wp-block-group__inner-container is-layout-constrained wp-block-group-is-layout-constrained\">\n<p>We are there for you right at the start of the logistics value chain and steer material flows in the right direction at the right time. Our network-controlled and monitored transport chains collect the goods required for your production from more than 3,000 suppliers in Europe and even worldwide &#8211; by land, air or sea.<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Delivery concepts: Just-in-time (JIT), <a href=\"\/uk-en\/glossar\/just-in-sequence-delivery-jis\/\">just in sequence<\/a> (JIS), <a href=\"\/uk-en\/glossar\/cross-docking\/\">cross-docking<\/a><\/li>\n\n\n\n<li>Inventory management<\/li>\n\n\n\n<li>Purchase of packaging &amp; consumables<\/li>\n\n\n\n<li>Area contract freight forwarding<\/li>\n\n\n\n<li><a href=\"\/uk-en\/glossar\/consignment-warehouse\/\">Consignment warehouse<\/a><\/li>\n\n\n\n<li>Supplier warehouse, VMI<\/li>\n\n\n\n<li>Supplier management<\/li>\n\n\n\n<li>Logistics outsourcing<\/li>\n\n\n\n<li>Milk runs<\/li>\n\n\n\n<li>Network-controlled transport<\/li>\n\n\n\n<li><a href=\"\/uk-en\/end-to-end-solutions\/our-business-models\/air-and-sea-freight\/\">Sea freight<\/a>, <a href=\"\/uk-en\/end-to-end-solutions\/our-business-models\/air-and-sea-freight\/\">air freight<\/a>, road transport<\/li>\n\n\n\n<li>Track &amp; trace, continuous shipment tracking<\/li>\n<\/ul>\n<\/div><\/div>\n\n\n\r\n    \r\n    <section class=\"back-button-block\">\r\n        \r\n        <div class=\"container\">\r\n            <div class=\"row my-5\">\r\n                <div class=\"col-12\">\r\n                    <div>\r\n                        \r\n                        <a href=\"\/uk-en\/\/glossary\/\" class=\"back-link wt-bt wt-unset-animation\">\r\n                            <span class=\"arrow\">\r\n                                <span><\/span>\r\n                                <span><\/span>\r\n                            <\/span>                           \r\n                            \r\n                            back to overview\r\n                        <\/a>\r\n\r\n                    <\/div>\r\n                <\/div>\r\n            <\/div>\r\n        <\/div>        \r\n        \r\n    <\/section>\n\n            \r\n        <div class=\"spacing-block large spacing-block-id-69d138561b7ab\" >                                     \r\n                  <div class=\"large-space\">   \r\n                  <\/div>                      \r\n        <\/div>","protected":false},"featured_media":0,"menu_order":0,"template":"","categories":[202,360],"class_list":["post-8229","glossary","type-glossary","status-publish","hentry","category-glossary-uk-en","category-p-uk-en"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.3 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Procurement logistics at LGI - reliable &amp; optimized.<\/title>\n<meta name=\"description\" content=\"LGI offers procurement logistics worldwide via land, air &amp; sea. 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