What is Inbound and Outbound?
Inbound and Outbound meaning
This is a commonly used classification of logistics activities in the supply chain:
Inbound Logistics: Involves acquiring raw materials and bringing them into a company. It involves sourcing, procurement, transportation, and warehousing of the materials needed.
Outbound Logistics: Encompasses sending finished products from a company to final customers, such as order fulfillment, packaging, transportation, and distribution of the finished goods to the designated destinations.
What are key differences between inbound vs outbound logistics?
| Inbound logistics | Outbound logistics | |
|---|---|---|
| Logistic direction | Acquiring raw materials towards company |
Sending finished products from company to customers |
| Supply and Demand | Supply Management | Demand Management |
| Key Parties involved | Suppliers, vendors, and their distributors | Distributors, wholesalers, retailers, and end customers |
| Key shipping process | Sourcing, procurement, materials handling, storage | Inventory management, order fulfillment, and shipping |
| Challenges | Shipping inefficiency, over stocking | Processing returns goods, long shipping time |
Understanding the distinction between inbound and outbound logistics is crucial for optimizing supply chain efficiency.
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