Distribution Logistics

Distribution logistics encompasses all physical and information-based processes involved in delivering finished, ready-to-sell products to customers. These activities include core elements such as storage, handling, transportation, order fulfillment, and distribution network management. The distribution process constitutes the final link in the supply chain and holds strategic importance for firms because it directly interfaces with the end consumer.

The primary objective of distribution systems is to deliver the right product, in the right quantity, at the right time, to the right place, and at the lowest possible cost. These five fundamental principles are defined in logistics as the “principles of accuracy” and are key factors determining the effectiveness of the distribution process. To achieve these principles, distribution channels must be structurally planned, transportation systems must be utilized efficiently, and information technologies must be leveraged.

Effective management of distribution logistics enables businesses to meet customer demands promptly and completely. As a result, customer satisfaction increases, the likelihood of repeat orders rises, and the firm’s competitive position in the market strengthens.

Distribution Network Design and Management

Distribution network design involves determining the routes and infrastructure to be used in delivering products to end customers. This network consists of production facilities, distribution centers, regional warehouses, wholesale points, and retail outlets. The structure of the distribution network is shaped by variables such as the intensity of customer demand, geographic distribution, product characteristics, transportation costs, and service level.

One of the methods used in planning distribution networks is genetic algorithms. These methods serve as decision support tools for issues such as the selection of distribution center locations, route planning, and cost optimization. Genetic algorithms provide alternative solutions across various scenarios to reduce distribution costs and shorten delivery times.

Technological Applications and Performance Indicators

The effectiveness of distribution logistics processes is directly linked to the use of information systems and digital technologies. Tools such as warehouse management systems (WMS), transportation management systems (TMS), order management software, and geographic information systems (GIS) play a critical role in monitoring, planning, and controlling distribution activities.

Integration of information systems enables real-time product tracking, route optimization, and measurement of delivery performance. These systems reduce error rates in logistics operations, enhance process efficiency, and elevate service levels aimed at improving customer satisfaction.

Logistics performance indicators include delivery time, delivery accuracy, distribution cost, inventory turnover rate, transportation capacity utilization, and order completion rate. These metrics allow businesses to evaluate their distribution activities and make strategic decisions.

Urbanization and Distribution Logistics Practices

Rising urbanization rates have direct impacts on distribution logistics practices. In particular, heavy traffic, narrow roads, parking restrictions, and environmental factors in major cities complicate urban distribution processes. As a result, the concept of urban logistics has come to the forefront, with specialized micro-distribution solutions being developed for city centers.

Urban distribution logistics requires low-volume but high-frequency deliveries. This situation makes order collection and delivery times critical, necessitating the use of light commercial vehicles, electric transportation systems, and consolidation centers. Additionally, traffic congestion and time constraints must be taken into account in distribution planning.