Contribution of logistics diagnosis to cost minimization: The case of a subsidiary of the automotive industry

Abstract

This paper presents a diagnostic for the logistic activity of an industrial company in Tunisia. Our methodology is essentially based on the application of an Ishikawa diagram, the five Whys method, and the Logarithmic Mean Divisia Index for logistic costs. Our results show that the Coverage Rate of Logistics Costs is the determinant factor in the intensity of quarterly logistics costs, while the Economic Asset Turnover appears to be of secondary importance. The serious logistics costs are due to several problems currently detected. To reduce the growth of logistics costs, we must implement corrective actions, of three types: immediate operations, progressive operations, and projected operations. Thus, the improvement of the overall performance of the company must go with the reduction of logistics costs.