When delving into supply chain management, plenty of terms circulate and cause some confusion, especially when this area of business isn’t your specialty. A distinction we often see fit to make is the difference between logistics and distribution, which are sometimes used interchangeably. However, they manage different sides of the business.
To begin, let’s define each term. The Oxford Dictionary defines logistics as “the detailed coordination of a complex operation involving many people, facilities, or supplies.” In contrast, distribution is “the action or process of supplying goods to stores and other businesses that sell to consumers.” We can see some overlap between these two definitions, but there is a crucial difference.
Logistics refers to the planning and production of goods, from sourcing materials to putting the finished product into storefronts or, in the case of e-commerce, to consumers’ front doors. On the other hand, distribution pertains to only that last part: transporting goods to other distribution centers, storefronts, and consumer homes. Typically distribution is thought of as the final process managed by logistics.
Some common advantages offered by logistics brokerages and third-party logistics companies like ABCO Logistics include hauling packages, rate negotiations, BOLs, tracking, and more access to a diverse network of equipment and transportation. Distribution-only companies handle finding the transportation and drivers needed for delivering goods.
At American Distribution and ABCO Logistics, we each specialize in these two fields to better help our clients. If you need assistance planning the process of manufacturing goods, ABCO Logistics is who you need to call. Still, American Distribution is here to help if it’s distribution and trucking-related. Feel free to contact our experts to start optimizing your business process today!