EIRP Proceedings, Vol 7 (2012)

Abstract

The objective of the paper “Increasing the company’s profitability through logistics management” is to present the significance of organizing an efficient logistics activity and the challenges that the companies are facing in order to obtain full advantage from using logistics as a competitive tool. The companies’ dependence from the strategic decisions belonging to the supply chain stands as a reason for the ever growing interest towards Supply Chain Management and towards applying innovative processes that will offer an advantage when faced with increasingly tougher competition from domestic or foreign companies. The company’s characteristics can be subject to deep changes through decisions pertaining to the supply chain; these decisions are vital to the company’s productivity and competitiveness. If the logistics’ role in increasing the company’s profitability is acknowledged, then implementing complex technologies and investing multiple factors into improving logistical performance is fully justified. Customer orientation and focusing on key activities, which need to be performed daily in order to meet customer demand are absolutely necessary in a system which implies fast reaction to market changes. The managerial way of thinking has changed significantly in the last years, because of the highly global competitiveness, the pressure to reduce costs, focusing on the company’s central competence. The principle of functioning is an aggregate system approach for the entire flow of information, materials and services beginning with supply of raw material, processes and movements inside the factories and warehouses, until the products reach the final customer.sadff