For making the goods available to the customers at the right place, in the right quantity and at the right time, following activities relating to physical distribution are required :
(i) Order processing – Order placement is the first step. Order processing cycle involves the following:
- Receipt of order from the customers.
- Entry of order in company’s records.
- Procuring goods from inventory.
- Despatch of goods.
(ii) Transportation – Transportation means physical movement of goods from one place to another. Roadways, railways, shipping, etc., are used in transportation. Transportation is an important activity because most of the markets are geographically separated.
(iii) Warehousing – Warehousing refers to an activity of holding the goods in perfect state to create time utility. The purpose of warehousing is to provide safety and protection of goods. Warehousing is needed when there is difference between the time of consumption and time of production.