Thursday, May 18, 2006

Logistics... hmmm my favorite subject (don believe a word of what I am saying)..

Anyway in the book: "Fundamentals of Logistics" (like if it had anything else than fundamentals), i read about the "Profit leverage of logistics". Oh wow, this is a very remarkable phenomena, so lets write 5 pages about it. The idea is that if you save 1 Euro on logistics, that is one euro profit for you. However if you increase your sales by one euro that will only result in a very little profit increase. (depending on several ratios but possibly only 0.2 euro) So -the book argues- logistics profit leverage is a very important thing. Learn it well.

Oh I know what you are thinking... OH MY GOD! (that is precisely what I thought). Following this logic, saving one euro on toilet paper consumption in the headquarters will result in one euro profit increase!! Soo, toilet paper is worth concentrating on, it just turned out to be more efficient than increasing sales. Quickly, lets find other things where saving one euro will result in a one euro profit.

I hope you dont mind if I leave that part to your imagination... by the way the same book says that logistics makes the world go around. I think I read the same thing in the communications book about (guess what) communications. Oaaah.. its hard to be a student these days... you just cant decide what makes the world go around.