Logistics is the design and management of a system to control the flow of material within a company. This is a very important part of an international company due to geographical barriers. The logistics of an international company includes the movement of raw materials, coordination of flows in and out of different countries, transportation choices, cost of transportation, packaging of the product for shipment, storage of the product and management of the entire process. The concept of logistics is quite new in the business world. The theoretical development was only used in 1966. Since then many business practices have evolved and logistics currently costs between 10 and 25% of the total cost of an international purchase. There are two main important phases in the movement of materials: material management and physical distribution. Materials management is the timely movement of raw materials, parts and supplies. Physical distribution is the movement of the company's finished products to customers. Both phases involve every step of the process including storage. The ultimate goal of logistics is to coordinate all of the company's efforts to maintain a cost-effective flow of goods. There are four logistics concepts: the system concept, the total cost concept, the after-tax concept, and the trade-off concept. The system concept is based on the fact that all functions of an organization work together to maximize benefits. This concept sometimes requires that some components of the organization operate suboptimally to achieve maximum system goals. The concept of total cost is based on the concept of system, however the achievement of objectives is measured in terms of costs. A variant of the total cost concept is the after-tax concept. The goal of this concept is profit after taxes. This concept is becoming very popular due to the many different national tax policies. The concept of trade-offs ties the system together in a way that is very efficient, but may involve trade-offs that may be inefficient. The benefits of such high efficiency must be weighed against the risks involved. One of the biggest obstacles in international logistics is geography. The distance and manner in which materials are to be shipped is the most important step in the entire...... middle of paper ......management is based on the fact that a company must have a division that helps control local- adaptation needs. Dealing with different cultures requires the contribution of the local branch. Managers who deal with cultural differences on a daily basis typically know what works and what doesn't. Outsourcing is the last option for logistics management. When this happens, transportation companies focus on logistics and the company can focus on manufacturing. There are many cost savings by using this type of program, however the lack of control can have negative effects on many businesses. International logistics requires many different options and requirements to be met for a company to operate internationally. It's like a big puzzle that needs to be put together in order to achieve all your goals. As described above, there are many options to consider and sometimes what appears to be an option is actually not. It's not hard to hit a roadblock and have to start over with a new plan. Once you have developed your logistics plan, you need to constantly look for improvements to maximize your profits and goals.