A careful study of Drucker's original intention will reveal that the understanding of this expression should be divided into two levels.
The first level refers to the waste caused by not monitoring the logistics cost. The profit generated by this part of cost reduction can be defined as an iceberg at sea. The above examples of transportation price changes have shown that when China is still in the stage of seller's market or changing from seller's market to buyer's market, in the environment of high sales profit rate, the operators and logistics managers of manufacturing enterprises are relatively low in price sensitivity to logistics costs, resulting in high market price of logistics business. At present, this situation is common in some lucrative industries, such as automobile industry, but for most manufacturing enterprises whose products are in oversupply, this part of the cost has been compressed to the limit.
On the second level, we should re-examine the total cost of enterprises from the perspective of enterprise strategy. This part of the cost can be defined as the iceberg at the bottom of the sea, which is what we often call the "profit source". In this respect, the cost increase and profit acquisition can't rely solely on the logistics reform of manufacturing enterprises.
Douglas M. Lambert confirmed that inventory is the cost component of one of the biggest logistics expenses in the article "The Development of Inventory Cost Calculation Method: A Study on the Related Costs of Inventory" written in 1976. This means that improving the inventory situation will help to improve the performance of logistics. According to an article published by Beijing Youth Daily, the inventory of goods that are not "flowing" in China has exceeded 3 trillion yuan. For manufacturing enterprises, a large inventory backlog has also caused a huge waste of resources.
In some stages of enterprise management, logistics is one of the keys to success, especially when some traditional industries are faced with changes in sales channels and service targets. In the same type of manufacturing enterprises, the level of logistics operation often plays a decisive role. For example, when the growth level of color TV consumption of urban residents approaches the limit, the sales strategies of many color TV manufacturers will shift to the countryside. At this time, the challenge to enterprise logistics will depend on its coverage of urban fringe areas. Only a perfect logistics operation network and strong distribution capacity can effectively support the shift of the focus of enterprise channels and enterprises can win among peers.
At this point, we can draw a logical conclusion that logistics is a key auxiliary function in manufacturing enterprises, but the excavation and realization of "third-party profit source" does not depend on the logistics strategy of manufacturing enterprises, but on the supply chain reform of manufacturing enterprises.
But wait! No sooner had the old problem been said than new problems began to appear. Since the realization of "third-party profit source" depends on the supply chain reform of manufacturing enterprises
This topic is a bit old.
At present, many domestic enterprises overcorrect this "profit source". The logistics department of many production enterprises only emphasizes the significance of reducing inventory from the perspective of improving the cost performance of logistics, which will inevitably be strongly opposed by the sales and production departments, which will bring certain negative effects to the operation of enterprises.