Definition
According to council of logistics management – “international logistics is the process of planning, implementing and controlling the flow and storage of goods and services and related information from a point of origin to a point of consumption located in a different country.
Components
- International transportation involved different modes of transportation, different carriers, and different transportation documents and much greater transit times. Its inherent risks and hazards are also much more significant.
- International insurance is also much more complex and contracts are written using archaic language and terminology that varies in meaning depending on the country in which the insurance company is located.
- International means of payment are more involved, with the risks of non payment and currency fluctuations, calling for specific strategies that are never used in domestic transactions
- Terms of trade are much more involved, as the greater number of nodes and links increases the number of possible alternatives for transfer of responsibility and ownership.
- The crossing of borders also represents specific challenges. Products sold or purchased abroad have to go through customs, a complicated and paper intensive process in most countries.
- Finally, the language, culture and physical environment of international logistics is quite distinct.
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