Role of Logistics in the Organization free essay sample

The Role of Logistics in the Organization Logistics is critical to the success of every organization. Once considered an important behind-the-scenes operational activity, logistics is now recognized as a strategic tool for creating customer value and loyalty. Companies like Wal-Mart,Coca Cola,and Nike attribute a great deal of their success to their global logistics systems. They realise that integrating activities within the organization and across the logistics pipeline, building strong relationships with product suppliers, and working with customer-focused logistics service providers are all crtitical to building a competitive advantage through logistics. †¢ The Marketing Concept It holds that achieving organizational goals depends on determining the needs and wants of target markets and delivering the desired satisfactions more effectively and efficiency than competitors. †¢ Customer satisfaction. Is a measure of how products and services supplied by a company meet or surpass customer expectations. Marketing Mix To create the right marketing mix, businesses have to meet the following conditions: †¢ The product has to have the right features for example, it must look good and work well. We will write a custom essay sample on Role of Logistics in the Organization or any similar topic specifically for you Do Not WasteYour Time HIRE WRITER Only 13.90 / page †¢ The price must be right. Consumer will need to buy in large numbers to produce a healthy profit. †¢ The goods must be in the right place at the right time. Making sure that the goods arrive when and where they are wanted is an important operation. †¢ The target group needs to be made aware of the existence and availability of the product through promotion. Successful promotion helps a firm to spread costs over a larger output. For example, a company like Kelloggs is constantly developing new breakfast cereals the product element is the new product itself, getting the price right involves examining customer perceptions and rival products as well as  costs of manufacture, promotion involves engaging in a range of promotional activities e. g. competitions, product tasting etc, and place involves using the best possible channels of distribution such as leading supermarket chains. The product is the central point on which  marketing  energy must focus. Finding out how to make the product, setting up the production line, providing the finance and manufacturing the product are not the responsibility of the  marketing function. Logistics adds time and place utility The marketing process must also add utility to the products consumers want. Utility is the use or satisfaction a person gets from a product. Form utility. is the want satisfaction generated by the physical characteristics of the product. In other words, the better the job a product does in filling the customers basic functional needs, the greater the products form utility. For example, consider a car. Form utility is provided by all the physical characteristics of the car. The primary need that is served, of course, is transportation the ability to get the customer from point A to point B. The better the car does at satisfying this basic functional need, the greater the degree of perceived form utility. Place utility is the want satisfaction associated with having the product available where customers want to buy it. Customers interested in obtaining place utility are essentially interested in convenience they do not want to go out of their way to buy the product. Customers are often willing of pay more for the product in return for this convenience. Examples of marketing activities that build place utility are convenience stores (e. g. 7-Eleven, Circle K, etc. ), in-home delivery, and in-home shopping (such as shopping via the television, telephone shopping, or shopping from your computer). Indeed, the ability to place orders and accept deliver for products in ones home has to be the ultimate place utility! Time utility is closely related to place utility. They go hand in hand. Time utility is the satisfaction gained from having the product available when you want to buy it. Time utility encompasses the desire for immediate gratification. Just as with place utility, customers often are willing to pay more in order to obtain products quickly. Examples of marketing activities that generate time utility are fast check-out lanes in grocery stores, drive-through windows at fast-food restaurants, ATMs, next day or one hour turn around by cleaners, vending machines, and, of course, the convenient shopping that is available at your local 7-Eleven or your neighborhood grocery store. Possession utility is the want satisfaction associated with product ownership. Possession utility generally is achieved when the customer acquires ownership of the product i. e. when title is passed to the customer. Possession Utility possession utility establishes legal ownership of a product. When you purchase something you normally receive a receipt; this provides legal ownership and the right to use the product. Some products, computer software, for example, also provide a user license. A license of this kind gives you the right to use the product within certain guidelines.