Integrated method of analysing logistics costs in supply chain

Abstract

Logistics and supply chain management (SCM) is in its development process, progressing stage after stage. The development process at the very first stage considers an evaluation criterion for evaluating effectiveness using minimum total logistics costs (TLC), which underlines the fact that, an important criterion in the development process is complete customers' satisfaction in services, or the 'level of service' (SL). At the same time, the question remains open as to how to quantify the impact of logistics operations and functions on the performance results of TLC and SL. The main aim of this paper is to develop a methodical approach and to come up with a computational approach to assessing the impact of different logistics operations factors (for example, transportation, storage, orders, etc.), on TLC and SL.