Business logistics was not an academic subject until the Nineteen Sixties. A key element of Logistics, the trade-off between transport and inventory costs, was formally recognized in economics at least as early as the mid-1880s. Based on the American experience, the development of logistics could be divided into four periods, which are represented as this picture.
Before the Nineteen Fifties, Logistics was under the dormant condition. Production was the main part of the managers concerned, and industry logistics was once regarded as "necessary evil" in this period. During the Nineteen Fifties to and Nineteen Sixties, applying new ideas of administration on business was a tendency. Drucker, who thought Logistics was The Economy’s Dark Continent, regarded the procedure of physical distribution after producing products as the most possible development area in American businesses but also the most neglected area. Lewis’s study (cited in Chang, 1998) in 1956 on the role of air transportation in physical distribution was the application of "total cost concept" and it pointed out the notions of trade-off between inventory and transportation. From the Nineteen Seventies onwards, more and more applications and researches of logistics appeared. Due to petroleum price rise in 1973, the effects of Logistics activities on enterprises grew. Slow growth of market, pressure of high stagflation, release of transportation control, and competitions of the third world on products and materials all increased the significance of Logistics system on planning and business at that time. The further tendency of logistics in the early 21st century is Logistics alliance, Third Party Logistics (TPL) and global logistics. Logistics circulation is an essential of business activities and sustaining competitiveness, however, to conduct and manage a large company is cost consuming and not economic. Therefore, alliance of international industries could save working costs and cooperation with TPL could specialize in logistics area.