For the logistics process requires the evaluation of possible physical distribution systems which meet the customer service standards required at the lowest possible cost. A system thus properly planned will increase the “response of the various elements in the process, the sensitivity to the distribution environment, knowledge of the possibilities of cost reduction and service optimization in the function, and the awareness of the effect of corporate strategy on the process.
The planning begins with deciding on the customer service strategies and goals, and goes on to the functions and investment involved in physical distribution, to decide on systems and procedures for the functions and then developing these strategies in human resource terms and implementing them. After this process is complete, the criteria for the selection of channel members have to be established. The performance of the strategy has to be monitored periodically and action for improvement taken if needed.
