According to Statista, companies in the United States transport roughly 5.56 trillion ton-miles of goods annually. However, while applying shipping logistics, it is tough to create the optimal management system. For instance, same-day delivery and free returns have reduced the margin for error in the logistics industry. Today, even small businesses demand top-tier shipping operations and supply chain management.
This article explains the distinction between shipping and logistics.
The term “shipment” refers to the thing you desire to move, while “logistics” refers to the process of carrying your cargo from its beginning point to its final destination.
Shipping logistics is the art of delivering goods, products, and raw resources over enormous distances with precision. While logistics and transport are interchangeable concepts. However, shipping only pertains to the transportation of products.
The supply chain includes logistics-related activities such as ordering, purchasing, forwarding, and warehousing.
Despite the importance of product delivery, businesses must also consider other factors to ensure everything functions well. Logistics also requires purchase, storage, and freight transportation.
WHAT IS SHIPPING LOGISTICS:
Shipping logistics is the process of organising and managing the transportation of goods, products, and raw materials.
The following are instances of logistics in shipping:
- Acquisition • Storage and warehousing • Packaging and consolidation • Routing of shipments • Tariff calculation and customs brokerage • Freight forwarding and intermodal cargo planning • Managing breakbulk and ocean freight • Monitoring of air freight • Transport management and shipping services
Shipping logistics is a sort of logistics, which is distinct from the potentially confusing terms shipping and logistics. Understanding the distinctions between each of these phrases is therefore advantageous.
Shipping: Off we go!
Shipping is the process of carrying cargo from A to B using ships, and it is a component of the marine industry.
Diverse types of ships deliver cargo across the globe:
- Oil-transporting tankers • Dry bulk carriers • Cargo Carriers in General • Container transporters • Fuel transporters • Offshore Vessels • Offshore Vessels • Ro-Ro ships • Other ferry/passenger ships
Shipping companies operate each of these vessels for profit. A large number of these vessels are operated by shipping companies. In contrast, many shipowners rent these vessels.
These marine organisations may operate a liner or tramp service. The majority of the liner sector relies on container shipping lines.
We, along with several other shipping companies, provide “shipping services” throughout the world’s multiple trade channels.
The top 10 container lines have a combined market share of 82,3 percent in the containerized commerce, while the remaining container lines have just a market share of 17.7 percent.
The following operations are involved in shipping, but are not limited to:
- Scheduling freight on the appropriate vessels, typically weeks or months in advance, and reserving cargo for certain vessels
- Ensure that the cargo is shipped on the boats that are about to be loaded. Ensure that the vessel’s stowage planning maximises vessel loads.
- Verify that each container’s VGM is present.
- Ensure safe loading and unloading of goods by issuing bills of lading and other papers for all loaded cargo.
Planning, marketing, sales, container department, vessel operations, paperwork, finance, administration, and procurement are some of the departments that a typical shipping business or shipping agency office possesses.
The following are components of each voyage’s shipping procedure:
- The volume of cargo available on these routes;
- The number of ships engaged on these routes;
- The ports that this service must visit to optimise business;
- The transit days of freight for a round-trip;
- The cost per voyage, which includes operational costs.
- Port costs
- Fuel costs
Shipping management is a crucial component of the business. It contributes to the shipping department’s smooth operation. Let’s start at the beginning of the cargo management process and discuss each step as we progress to the end.
PLANNING THE SHIPMENT:
Once the delivery company receives the product, numerous tasks must be accomplished. As part of the shipment planning process, creating shipping documentation, identifying the type of cargo, and preparing the invoice status are all required.
DOCUMENTS TO SHIP:
First in the planning procedure is the preparation of shipping documents. Numerous types of shipping documentation are required for the cargo process to go well. Shipping policy documents, shipping labels, creating bills of lading and freight bills, shipping insurance documents, ensuring a packing list, and generating business invoice paper are a few examples.
TYPES OF SHIPMENTS:
Check to see if the type of shipment is indicated on the shipping documents, and if it isn’t, double-check that it is (at least for internal purposes). There is a decreased likelihood of inconsistencies, and both parties can maintain transparency. Examples of shipping types include rail, road, air, and marine freight.
INVOICE STATUS PREPARATION:
There is an evaluation of both shipping documentation and cargo type. It is vital to verify that the payment terms are clear, and if they are not, they must be indicated on the payment documentation. Always maintain an internal ledger in which each shipment’s invoices are precisely recorded. In addition, for clarity and openness, affirm the same with the customer. Whether the transaction is paid in full or in part, the invoice status should reflect that. Also state whether the cargo is expedited, flat-rate, or any other essential information.
VERIFICATION OF THE SHIPMENTS:
Constantly essential are both the cargo documentation and the package itself. Include a packing slip and an invoice for packaging. Ensure that there are no discrepancies between the products and the documents. Verify that the product’s description, quantity, pricing, and shipping conditions are correct and clear.
TRACK AND TRACE OF SHIPPING:
It is now possible to track every cargo due to advances in technology and a rise in its popularity among the general population. There is an abundance of shipping software available to aid with this. Often, the success of tracking products can be attributed to automation. By entering the consignment number, any shipping company can track its shipments. All of this is possible because shipments have a chip or barcode. Included in the tracking information are the item’s kind, current status, and anticipated delivery date. The only requirement is the tracking number.
It is believed that the term logistics originated in the military and was initially used to describe the mobility of troops and equipment across various areas of military operations.
Logistics is the process of transferring items from a manufacturer’s warehouse, point of origin, mining site, or farm to a receiver’s warehouse, door, or store.
The logistics process begins much before the actual shipment, as it involves negotiating delivery schedules that are acceptable to both the client and the supplier.
A LSP (Logistics Services Provider) must be able to identify the optimal cargo transportation solution. Freight is transported via road, rail, air, and sea, and each mode of transportation has its own set of features.
However, airfreight is substantially more expensive than seafreight. Rail freight is less harmful to the environment than vehicle freight and may offer more reliable travel times and timetables. Road freight is one of the most cost-effective ways of transportation and may provide door-to-door service.
Logistics is responsible for the design, implementation, and execution of multiple components involving: • The transportation of items such as goods and services • information • shipping • paperwork • scheduling • tracking and delivery
TYPES OF LOGISTICS:
Three types of Logistics exist:
- incoming logistics, outgoing logistics, and reverse logistics
Inbound logistics is the process of receiving things from a supplier, producer, or point of origin.
Outbound logistics is the process of sending products to their final destination (typically the customer).
Reverse logistics is the process of collecting returned items from consumers.
Each of the three types of logistics utilises shipping and has its own logistics plan. When a customer returns or exchanges an item, businesses get inbound shipments, send outbound shipments, and receive reverse shipments.
Logistics management is the process of satisfying customer needs while planning, implementing, and managing the efficient flow of goods.
It is a vital component of any transportation operation. It takes into account the time and expense of moving goods, and it affects many facets of our lives beyond casual shipping.
In essence, shipping is the transportation of goods via freight. In contrast, logistics is a broad term that refers to the entire transportation process.
The significance of logistics:
Because shipping and shipping costs can contribute significantly to a company’s bottom line, logistics is essential for both large and small businesses.
By increasing distribution efficiency, delivery accuracy, customer service, and having a well-designed, well-organized logistic management system, a business can increase sales and profits.
For businesses who maintain an eCommerce website, shipping efficiency also entails a shorter wait for the delivery of consumers’ purchases and a quicker response to customer service issues.
- fuel and freight cost savings • lower damage rates for multinational firms with global operations as a result of more effective shipping
The proper shipping management solution may also aid in inventory control by: allowing for enhanced demand forecasting and enabling the allocation of shipping resources to clients who do not require as many goods.
Additionally, logistics facilitates waste reduction and compliance with government regulations, making it easier for enterprises to deliver goods on time and under budget.
With an appropriate plan, logistics management may provide significantly more insight into all aspects of warehouse and shipping operations. Managers can manage product distribution mapping, real-time routing data and tracking, order fulfilment rates, and sustainability and automation-related supply chain KPIs.
FOUR TRANSPORTATION TYPES IN LOGISTICS:
Four distinct kinds of logistics transportation are available for exporting goods.
- Ships \s• Trucks \s• Trains \s• Planes.
Additionally known as marine, road, rail, and air shipments. These examples illustrate these forms of transportation.
TRANSPORT VIA SEA AND OCEAN
Since it is one of the most cost- and time-efficient ways of freight transportation, ocean transport is one of the most popular! Ships convey containers containing food, clothing, autos, and furniture across oceans.
TRANSPORTATION AND TRUCKING ON THE GROUND
Trucking is sometimes referred to as “ground shipping” since it involves the transport of goods via road and highway networks. Despite the fact that trucks burn more fuel than planes and other modes of transportation, trucking continues to be the favoured means of transit for shipping logistics.
TRANSPORTATION BY AIR
As part of an air transport service commonly referred to as air freight, planes convey the shipments through many airports. This delivery method may take anywhere from one to three days, depending on the location of the product.
WHAT IS THE DIFFERENCE BETWEEN SHIPPING AND LOGISTICS:
Shipping is the act of transporting goods or resources between locations. In contrast, logistics is the process of supervising a complex activity.
Shipping is the act or practise of transporting a shipment from one point to another. Shipping is a closed term that only refers to shipping-related information. Shipment costs, shipping documentation, shipping types, and other aspects must be considered.
In contrast, logistics is a somewhat more complex term that involves numerous companies or departments. Logistics is a broad term that incorporates shipping management, whereas cargo is a more particular and confined phrase.
Not only in transportation, but also in numerous other businesses. Depending on their demands, hospitals rely on logistics to transport patients to different rooms and floors. Meanwhile, food delivery companies rely on logistics to provide meals to customers as quickly as feasible.
Shipping is the process of transporting goods from one area to another. It is understood that shipping logistics include all procedures involved in transporting products safely. Alternatively, logistics refers to the management of any complex task.
Custom Crating and Logistics can help you boost the productivity of your dispatchers and drivers, regardless of whether you have a delivery fleet of hundreds or thousands of vehicles. Contact us for further details.