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How to choose an effective third party logistics provider
Abstract
The purpose of this article was to identify the steps that need to be taken when choosing an effective third party logistics provider. Based on the research completed, it was determined that third party logistics are beneficial to many companies. The use of third party logistics provides a competitive advantage in today’s business world. The optimal solution for a company choosing a third party logistic provider would be a five-step process.
... Third party logistics (3PL) can be defined as the outsourcing of all or much of a company's logistics operations to a specialized company [1] and 3PL provider (hereafter referred to as logistics service provider) is an external provider who manages, controls and delivers logistics activities for firms [6]. Logistics service providers may carry out transportation, warehousing, inventory management, order processing; consolidate shipments; select carriers, information system, packaging activities, and returns handling [7,8,9]. Globally, the most outsourced logistics processes are domestic transportation (80%), warehousing (66%), international transportation (60%), freight forwarding (48%), customs brokerage (45%) and reverse logistics (34%) [2]. ...
... Outsourcing may facilitate the reduction of the cost and achievement of effectiveness in logistics activities [5]. The main benefits of logistics outsourcing include the following: concentrating on core competencies, improving performance, receiving a higher level of service quality, achieving cost saving opportunities, reducing logistics costs, reducing asset base, gaining flexibility in supply chain, shortening average order-cycle lengths, extending the market boundaries, gaining access to leading edge technology, achieving flexibility in adapting to changes in the market, increasing the market knowledge and data access, enhancing innovation performance, reaching a greater level of flexibility to respond to the customer needs, achieving expertise and experience, increasing customer satisfaction, making better use of resources, improving service quality and restructuring supply chain [2,5,7,9,[11][12][13][14][15][16][17][18][19][20]. In other words, logistics outsourcing enhances the efficiency and strengthens the business. ...
... Further, different industries have unique characteristics and specific requirements and priorities. Therefore, the selection criteria and the importance of these criteria may be different [7,9,43]. Previous studies show that firms from different industries have different logistics service provider selection decisions [5]. ...
... 3PL can be defined as the outsourcing of all or much of a company's logistics operations to a specialized company (CSCMP, 2016) and 3PL provider (hereafter referred to as LSP) is an external provider who manages, controls and delivers logistics activities for firms (Hertz & Alfredsson, 2003). LSPs may carry out transportation, warehousing, inventory management, order processing, consolidate shipments, select carriers, information system, packaging activities, and returns handling (Aghazadeh, 2003;Aguezzoul, Rabenasolo, & Jolly-Desodt, 2006;Liu & Wang, 2009). Globally, the most outsourced logistics processes are domestic transportation (80%), warehousing (66%), international transportation (60%), freight forwarding (48%), customs brokerage (45%) and reverse logistics (34%) (Langley & Capgemini, 2016). ...
... Outsourcing may facilitate the reduction of the cost and achievement of effectiveness in logistics activities (Hwang et al., 2016). The main benefits of logistics outsourcing include the following: concentrating on core competencies, improving performance, receiving a higher level of service quality, achieving cost saving opportunities, reducing logistics costs, reducing asset base, gaining flexibility in supply chain, shortening average order-cycle lengths, extending the market boundaries, gaining access to leading edge technology, achieving flexibility in adapting to changes in the market, increasing the market knowledge and data access, enhancing innovation performance, reaching a greater level of flexibility to respond to the customer needs, achieving expertise and experience, increasing customer satisfaction, making better use of resources, improving service quality and restructuring supply chain (Aghazadeh, 2003;Alkhatib, Darlington, & Nguyen, 2015a;Alkhatib, Darlington, Yang, & Nguyen, 2015b;Hsiao, Kemp, Van Der Vorst, & Omta, 2010;Hwang et al., 2016;Jharkharia & Shankar, 2007;Kumar, Singh, & Dureja, 2012;Langley & Capgemini, 2016;Li et al., 2012;Liu & Wang, 2009;Percin & Min, 2013;Razzaque & Sheng, 1998;Selviaridis & Spring, 2007;Wong & Karia, 2010). In other words, logistics outsourcing enhances the efficiency and strengthens the business. ...
... Further, different industries have unique characteristics and specific requirements and priorities. Therefore, the selection criteria and the importance of these criteria may be different (Aghazadeh, 2003;Liu & Hai, 2005;Liu & Wang, 2009). Previous studies show that firms from different industries have different logistics service provider selection decisions (Hwang et al., 2016). ...
Outsourcing has become an increasingly popular means for businesses through which to improve their efficiency. Logistics outsourcing can be described as transferring some of the logistics functions to an external firm. This paper aims to identify the selection criteria that are used by logistics service providers in Turkey’s cement sector in choosing the third-party service provider. By drawing on
Chang’s Extent Analysis on Fuzzy Analytical Hierarchy Process (FAHP), the present paper evaluates cost, service/operation quality, competencies, general attributes of firms and relational factors as the
main criteria, and considers explanatory 29 sub-criteria. In doing so, a questionnaire which was prepared in the pairwise comparison model was used as a large sample to collect data from a total of 25 experts working in 14 cement companies. As a result, the analysis identifies service/operation quality as the most important one among the main criteria, and determines the service price as the most preferred criterion among the sub-criteria. The study and results both provides particular insight into a specific sector as it is based on the data collected from a large number of experts in one sector, and offers an opportunity for other sectors from the same point of view.
... Globalization, lead times Downsizing, customer orientation and Outsourcing is in logistics here are some key changes that contribute to the interest. [7] Companies to focus on their core competencies by allowing, these third-party logistics (3PL) costs of customer service providers Improve and decrease. A 3PL provider is a As a lead logistics provider or 3PL A fourth party because of its affiliation with the providers Can act as a logistics (4PL) provider [8] Third party logistics perform these functions Bringing in a third party to help manage is defined. ...
... Finally, Validation of the developed approach and Applicability through a numerical example Verified and comparative investigation and parametric analysis and separately Excellence is characterized by flexibility. [7] Decision makers evaluate and weight the alternatives and criteria, respectively And while there are uncertainties in definition, fuzzy theory accounts for existing uncertainties Provides a suitable tool to handle. In this paper, to evaluate a possible maintenance strategy of COPRAS and AHP A new based on comments Fuzzy MCDM method proposed Linguistic terms for estimating ratings and weights are used. ...
One is called 2PL or second party logistics. A 3PL refers to parts of the supply chain Distribution, Warehousing and Fulfillment Including outsourcing to third parties is a company that does, while a 2PL is shipping lines, airlines or cargo the senders are the actual carrier. What is Third Party Logistics? Logistics and in the context of supply chain management, the company outsources businesses to third parties uses to make or distribute them and third-party fulfillment services Also known as logistics. Alternative are Operational efficiency, customer operations Integration, vertical or horizontal integration, supply chain management and Integration. Evaluation option: % of personnel in gen. mgmt and business development, % of services is value-added, Expected annual growth rate 1995-1998 in %, Competencies, Skills lacking. From the result is Skills lacking got the first grade, Competencies got having the lowest rank. The value of the dataset for Third-party logistics in COPRAS method shows that it results in Skills lacking Decision and top ranking.
... The terms 'Third-Party Logistics' (3PL) and 'logistics outsourcing' are used to describe the organisational practice of sub-contracting part or all logistics activities previously performed in-house (Selviaridis and Spring 2007;Aghazadeh 2003;Lieb, Millen, and Van Wassenhove 1993). From the origin of 3PL in the late 1980s, its importance has grown over time (Roy and Sengupta 2018). ...
... In recent years, the expansion of the 3PL market has contributed to the evolution of the industry itself. Historically, 3PL providers delivered traditional logistics services, such as transport and warehouse management activities (Aghazadeh 2003;Zacharia et al. 2011). However, 3PL providers are changing their role due to increased volumes and scope of services demanded: today, they are engaged in strategic coordination of their customers' supply chain activities (Zacharia et al. 2011). ...
In recent years, the logistics outsourcing market has significantly expanded, driving also the growth of the logistics real estate sector. However, these subjects have been investigated separately, without empirical evidence on the assessment of warehouse features, nor studies matching those with 3PL providers’ needs. This paper aims to fill this gap by providing a deeper understanding of the alignment between the 3PL industry’s needs and the logistics real estate offering. An extensive literature review was used to investigate the characteristics of the logistics real estate industry and define the present and future challenges for the 3PL industry. Afterwards, 3PL warehouse features were analysed through data collected on 75 logistics buildings located in Italy. Results indicate that the logistics real estate seems relatively prepared to support the 3PL industry’s needs. However, such alignment could be further strengthened through investments by the logistics real estate towards environmental sustainability and warehouse automation.
... Aghazadeh [1] highlighted that 3PL successful relationship mainly depends on customers and service providers' need. The author proposed the five essential criteria, namely-information technology system, trust, mutual respect, similar value and objectives, and shared willingness to make a better relationship. ...
... Step 4: The total-relation matrix TR can be calculated using Eq. (4) = TR N(I N) 1 (4) ...
The maximum amount of food losses in the fruits and vegetable supply chain due to quality and mismatch between supply and demand. As per the Global Agenda Council on Logistics and Supply Chains indicated that fruits and vegetables food losses due to improper handling and lack of proper cold transportation such as cold-logistics facilities/providers or inadequate infrastructure. In this article, a unique fuzzy Multi-Criteria Decision Making approach is proposed for improving the food losses through cold-third party logistics providers (CTPLs) evaluation and selection process. Through a literature survey and expert opinion, five criteria and thirty sub-criteria were identified for reducing the food losses in fruits and vegetable supply chain. The proposed tool use of fuzzy-Decision making trial and evaluation laboratory tool for selection and evaluation the priority weights of the factors and fuzzy-analytical hierarchy process tool assessing the best CTPLs according to factors. The result shows that ‘Refrigerator and loading capacity’ and ‘Knowledge and Information technology management’ were most significant in the selection of CTPLs. The findings of this paper are anticipated to guide managers of the food industry, CTPLs, and government agencies in formulating of strategies for the practical food supply chain. Future scope includes extending the study for other developing countries, validating the proposed methodology, and improving the reliability of the model.
... Since the early 1990s, the worldwide practices of outsourcing logistic activities have been increasing, resulting in an annual 10% increase (Sohail et al.;2003). According to "Cap Gemini Ernst & Young" survey (2002), the rates of resorting to logistic suppliers have reached 94% in Europe, 78% in North America and 92% in Pacific Asia. ...
... Another study by Aghazadeh (2003), presents four relevant criteria for selecting an effective 3PL, which are: similar value, information technology systems, key management, and relationship. The various studies mentioned above clearly show that 3PL selection is multicriteria. ...
... A number of peculiarities related to the logistics services supply may be found, due to the uniqueness of each activity usually resulting from the high variability of tasks to meet customer-specific service requirements (e.g., Large et al., 2011;Yeung et al., 2006;Frediksson and Johansson, 2009;Vickery et al., 2004). Because of its specific features and requirements, a stream of dedicated literature has been developed on the 3PL buying process (e.g., Bandeira et al., 2015;Jharkharia and Shankar, 2007;Aghazadeh, 2003;Andersson and Norrman, 2002;Sink and Langley, 1997). ...
... According to the main studies on the 3PL buying process (e.g., Aghazadeh, 2003;Sink and Langley, 1997), competitive advantages related to logistics outsourcing and 3PL selection criteria are key features in the 3PL buying process. These two main topics are discussed below. ...
Although logistics outsourcing is recognised as a competitive parameter, so far there has been no adequate research on the types of logistics outsourcing and their implications in terms of the third-party logistics (3PL) buying process. This paper fills the gap by focussing on two key issues, i.e., required competitive advantages and 3PL selection criteria. The aim is to provide a comprehensive investigation of such factors and study if and how they vary depending on the outsourcing type. After a literature review and a focus group, a survey of 482 logistics managers was conducted, and a statistical
analysis of results was performed. The findings are of interest to both shippers and 3PL providers because they help the former understand which outsourcing type is the most suitable to achieve the desired competitive advantages, and the latter to evaluate the key factors to focus on depending on the required type of outsourcing.
... A number of peculiarities related to the logistics services supply may be found, due to the uniqueness of each activity usually resulting from the high variability of tasks to meet customer-specific service requirements (e.g., Large et al., 2011;Yeung et al., 2006;Frediksson and Johansson, 2009;Vickery et al., 2004). Because of its specific features and requirements, a stream of dedicated literature has been developed on the 3PL buying process (e.g., Bandeira et al., 2015;Jharkharia and Shankar, 2007;Aghazadeh, 2003;Andersson and Norrman, 2002;Sink and Langley, 1997). ...
... According to the main studies on the 3PL buying process (e.g., Aghazadeh, 2003;Sink and Langley, 1997), competitive advantages related to logistics outsourcing and 3PL selection criteria are key features in the 3PL buying process. These two main topics are discussed below. ...
... et al. (1993),Rabinovich et al. (1999),Logan (2000),Hertz and Alfredsson (2003) Increase in bargaining powerAghazadeh (2003),Hertz and Alfredsson (2003) Best practice transferHertz and Alfredsson (2003) Spatial aggregation (e.g. multi-pick, cross-docking)Berglund et al. (1999),Bhatnagar et al. (1999),Rabinovich et al. (1999),Logan (2000),Lai et al. (2004) Use of shared IT systems for multiple clientsBerglund et al. (1999),Rabinovich et al. (1999),Lai et al. (2004) Development of problem-solving abilitiesHertz and Alfredsson (2003),Lai et al. (2004) Introduction of multi-producer warehouse(s)Lai et al. (2004) Market segment specialisationRao and Young (1994),Persson and Virum (2001),Hertz and Alfredsson (2003),Lai et al. (2004), Ying and Dayong (2005) Horizontal integration (i.e. ...
... ,Berglund et al. (1999),Bhatnagar et al. (1999),Aghazadeh (2003),Belcourt (2006),Jharkharia and Shankar (2007) Support to continuous improvementHertz and Alfredsson (2003), Selviaridis and Spring(2007), Wallenburg (2009) Human resource stretching Belcourt (2006), Wallenburg (2009) Synergic management of shippers with complementary product seasonality Lieb et al. (1993), Hsiao et al. (2010) BackhaulingLogan(2000),Efendigil et al. (2008),Hsiao et al. (2010) ...
Purpose
The resources and mechanisms required to complete a value proposition are generally considered as crucial aspects in designing a company business model. However, research in the third party logistics (3PL) arena concerned with studying how 3PL providers define their value creation architecture to meet different shippers’ requirements has so far been inadequate. The purpose of this paper is to fill the gap, providing a detailed investigation on how the 3PL providers’ capabilities and logistics expertise can add value to their shippers’ processes.
Design/methodology/approach
A qualitative exploratory research was conducted involving, first, a systematic combining process to understand the main factors and operational strategies whereby 3PL providers can create value and build a comprehensive framework of their value creation architecture. Second, a qualitative survey was conducted on 44 leading 3PL providers operating in Italy to understand how these providers can organise themselves to create value for shippers.
Findings
The 3PL providers’ value creation architecture is presented within a clear and comprehensive framework, together with 30 potential operational strategies that can be used by 3PL providers and the related factors that enable value to be created for shippers. Three main value creation models (volume-oriented 3PL providers, process-oriented 3PL providers and innovation-oriented 3PL providers) are identified. The importance of the different factors enabling value creation is highlighted for each model, identifying the distinctive operational strategies and those adopted most frequently.
Practical implications
From a managerial perspective, 3PL providers will find these results useful for developing suitable strategies to compete on the market. From their side, shippers can understand and evaluate how 3PL providers are able to offer value to their logistics processes, allowing them to select the logistics partner who best fits their needs.
Originality/value
The present paper fulfils the identified need of examining the 3PL providers’ business model in detail. A set of distinct value creation models is identified and thoroughly investigated to reveal the different competitive advantages available to shippers.
... Literature review TPL originally began during the 1970s as public warehousing, when manager's of warehouses began to sell space to business organizations when it ran out of space during busy seasons (Aghazadeh, 2003). By 1980s TPL expanded into selling not only space but also offering throughput to physical distribution managers who wanted to improve customer service with their current customers (Tompkins, 1999). ...
... While outsourcing is a complex decision evolving due to numerous reasons, the organization needs to decide if they need TPL. It is suggested that a team representing all departments within a company should make the decision (Aghazadeh, 2003). Organizational decision making on the usage of TPL is guided by a number of other factors. ...
Purpose – With competitive pressures placing an increasing dependence on the ability of organizations to deliver customer-adapted products quickly and on time, logistics has been an area that has been subjected to investigation. While there is a growing evidence of organizations increasingly seeking to outsource their logistics activities, there have been few comprehensive studies on the outsourcing of logistics in the Middle Eastern region. The purpose of this paper is to examine the usage of third party logistics (TPL) services in Saudi Arabia.
Design/Methodology/Approach – Empirical research is used to study the extent firms use the services of logistics companies; the time period these have been used; the decision-making process for choosing contract logistics and its impact on the organization.
Findings – Results based on the analysis of data relating to 496 firms in Saudi Arabia indicate that most of these users are satisfied with the services providers and has largely seen positive developments within the organization.
Practical Implications – The results provide managers with evidence supporting the benefits of logistics outsourcing. The study also contains useful information for the providers of contract logistics services on the most frequently used services.
Originality/Value – This study makes a significant addition to literature on logistics outsourcing as little empirical research has been previously reported from Arab world and Saudi Arabia. Saudi Arabia to establish linkages between organizations and TPL providers. Moreover, the results of this study will also serve as a future benchmark for the entire Gulf Cooperation Council region, as Saudi Arabia happens to be the largest country in the Middle East.
... Moreover, according to Ansari and Modarress (2010), apart from cost reduction, cargo security is also an important reason to outsource logistics activities to third party logistics providers. Furthermore, market knowledge, data access, improved expertise and flexibility are some other benefits (Aghazadeh, 2003). The development of the third party logistics industry can be divided into three main stages. ...
... Üçüncü parti lojistik; "Birden fazla lojistik hizmetinin tek bir hizmet sağlayıcı tarafından bir sözleşme kapsamında sağlanması" ya da tedarik zinciri içindeki temel lojistik faaliyetlerinden bir kaçının, konusunda uzman lojistik şirketleri tarafından üstlenilmesi" olarak tanımlanmıştır. Üçüncü parti lojistik müşterisi için değer yaratan bağımsız ekonomik bir varlıktır (AGHAZADEH, 2003). Asıl işi mal üretimi olan işletmeler, lojistik faaliyetlerinde etkili olabilmek amacıyla, bu faaliyetler konusunda uzmanlaşmış ve işi lojistik hizmeti üretmek olan lojistik hizmet sağlayıcı işletmelerini tercih etmektedirler. ...
Bu çalışmanın amacı, Bursa’da üretim sektöründe faaliyet gösteren tekstil ve inşaat işletmelerinin, lojistik faaliyetlerinde dış kaynak kullanımına ilişkin uygulamalarının araştırılması ve işletmelerin lojistik faaliyetlerinde, faaliyet alanlarına, faaliyet sürelerine ve çalışan sayılarına göre dış kaynak kullanım nedenleri arasında bir farklılık olup olmadığının ortaya çıkartılmasıdır.
Araştırmanın amaçlarına yönelik olarak, Bursa ilinde faaliyette bulunan tekstil ve inşaat işletmelerinin 117 üst ve orta düzey yöneticisinden, anket yoluyla elde edilen veriler SPSS 20 paket programı kullanılarak; tanımlayıcı istatistikler, bağımsız örneklem t testi ve tek yönlü ANOVA testleri ile analiz edilmiştir. Araştırma bulgularına göre, en fazla tercih edilen lojistik faaliyetin ‘‘ulaştırma’’, en az tercih edilen faaliyetin ise ‘‘talep tahmini’’ olduğu ve söz konusu işletmelerin bazı demografik özelliklerine göre dış kaynak kullanma nedenlerinde anlamlı farklılıklar olduğu ortaya çıkmıştır.
The purpose of this study, the operating in the textile and construction enterprises in the production sector, in Bursa, outsourcing of logistics activities and logistics activities of the businesses relating to the investigation of the application, scope, and number of employees according to their periods of activity, must considered whether there is a difference between the reasons for outsourcing.
For the purposes of the research, data obtained through the survey from 117 of the upper and mid-level manager, textile and construction business which have activities in the province of Bursa, using the package SPSS 20 programme; descriptive statistics, independent sample t-test and one-way ANOVA tests were analyzed. According to the survey findings, the most preferred logistics ‘transport’, at least in preferred activity ‘demand forecasting’ and some of the businesses in question according to demographic characteristics there appeared to be significant differences in the reasons for using an external source.
... Pengurusan logistik disebut sebagai proses terperinci dalam merancang, melaksana, dan mengawal kos aliran yang cekap dan berkesan dalam penyimpanan bahan dan produk, dan maklumat yang berkaitan dalam rantaian bekalan untuk memenuhi permintaan pelanggan (CLM, 2004). Aghazadeh (2003) menyatakan bahawa logistik adalah proses strategik dalam menguruskan pergerakan dan penyimpanan bahan atau produk dan maklumat yang berkaitan dari mana-mana pergerakan dalam proses pembuatan untuk memberikan kepuasan kepada pengguna. ...
Pelaksanaan yang betul dalam sistem logistik terbalik boleh menyebabkan kesetiaan pelanggan dan pengurangan kos operasi kerana penggunaan semula atau pengilangan semula beberapa bahagian produk. Ianya penting untuk industri-industri yang mempunyai kitaran hayat produk yang pendek seperti industri perkilangan. Dalam dunia yang mempunyai sumber yang terhad, proses pemulihan yang digunakan untuk bahan atau produk adalah kunci untuk menyokong populasi penduduk dalam peningkatan penggunaan bahan. Justeru, kajian ini adalah untuk mengkaji faktor- faktor adaptasi logistik terbalik dan faktor dominan dalam adaptasi logistik terbalik dalam industri perkilangan. Kajian ini dilakukan di syarikat perkilangan yang terletak di Selangor. Pengumpulan data kajian dijalankan dengan menggunakan data primer dan data sekunder dimana data primer diperolehi hasil daripada borang soal selidik yang diedarkan di sekitar negeri Selangor. Manakala, data sekunder diperolehi melalui pembacaan tesis, buku, jurnal dan sebagainya. Hasil dapatan kajian menunjukkan bahawa faktor dominan dalam adaptasi logistik terbalik adalah faktor ekonomi. Secara keseluruhannya, hasil kajian ini diharapkan dapat memperbanyakkan lagi syarikat perindustrian yang menjalankan aktiviti logistik terbalik.
... Logistics activity is complex and changeable, motivating some studies to treat flexibility as an important factor in evaluation (Göl & Çatay, 2007). Experience in a similar industry is also found to be an essential factor in selection by the existing research (Aghazadeh, 2003). ...
In the era of circular economies, governments and consumers are increasingly aware of environmental protection, which encourages enterprises to devote more attention to reverse logistics (RL). However, the limited resources and technical limitations of most manufacturing companies have motivated them to outsource their RL activities to professional third-party RL providers (3PRLPs). Optimal 3PRLP selection is instrumentally valuable in RL outsourcing practices because it has the potential to increase enterprises' economic profitability and to improve their long-term development. Generally, 3PRLP selection is treated as a multiple-attribute decision-making (MADM) problem. To this end, this paper aims to build a multi-perspective MADM (MPMADM) framework to offer systematic decision support for enterprises to select the optimal 3PRLPs. Attribute assessments in the proposed framework take the form of generalized comparative linguistic expressions (GCLEs), which can be transformed into hesitant fuzzy linguistic term set (HFLTS) possibility distributions with semantic analysis in order to enhance information quality and reliability. Expert weights are then assigned in the use of an optimization model based on the correlation consensus measurement. Afterwards, the two-stage aggregation paradigm for computing with HFLTS possibility distributions is used to gather assessments at expert and attribute levels to compile overall assessments of each alternative 3PRLP. Compared with existing studies, our proposal considers environmental and social sustainability for attribute system establishment and introduces GCLEs for 3PRLP selection, which offer greater flexibility for experts to articulate their evaluations. In addition, the two-stage aggregation paradigm eliminates distortion and loss of information and provides decision makers with the capability to control the outcome's precision. Moreover, the proposed expert weight determination approach is conducive to generating reliable weight vectors. Several illustrative examples, sensitivity analysis, and comparative analysis further demonstrate the flexibility and practicability of our proposal.
... Sales level contributes to decrease and improve the profit of businesses [8]. Sales include all integrated activities that delivering goods or services from producer to the customers. ...
The aim of this research is to assess the impact of logistics performance on retails sector. This research was conducted in Palu in Central Sulawesi Province. There are several indicators involve in this study, such as, customer service, operation, metric, and logistics cost. This research is categorised as explanatory research and multiple regression method was used to analyse the hypotheses. Simultaneously, this research found that logistics performance has significant contribution to retails' sales level. However, customer service has not had positive contribution to sales level compare to operation metric and logistics cost. In addition, logistics cost has a big impact on retails sales level. The result of this research can be used by academicians and professionals who intent to deal with logistics in the retail sector. This research identifies that logistics performance need further study in different region and sector with the aim to improve the understanding of dimensions.
... This power can have numerous measurements: economies of scale, process ability, access to capital, access to costly innovation, and so forth. By re-appropriating coordination exercises, firms can save money on capital venture and along these lines diminish budgetary dangers [3,5]. Numerous 3PL organizations give an expert coordination benefit. ...
... H E 1 S ¼ fs 4 , s 5 g fs 2 , s 3 g fs 3 , s 4 , s 5 g f s 4 , s 5 g fs 1 , s 2 , s 3 g fs 0 , s 1 g f s 3 , s 4 g f s 0 , s 1 g fs 2 , s 3 , s 4 g fs 3 , s 4 , s 5 g fs 3 , s 4 g f s 2 , s 3 , s 4 g fs 3 , s 4 g fs 1 , s 2 , s 3 g fs 2 , s 3 , s 4 g fs 1 , s 2 , s 3 g fs 4 , s 5 , s 6 g fs 5 , s 6 g fs 2 , s 3 , s 4 , s 5 g fs 4 , s 5 g fs 3 , s 4 , s 5 g fs 0 , s 1 , s 2 g fs 0 , s 1 , s 2 g fs 1 , s 2 g fs 3 , s 4 , s 5 g fs 4 , s 5 g fs 1 , s 2 , s 3 g fs 3 , s 4 , s 5 g fs 5 , s 6 g fs 2 , s 3 , s 4 g fs 5 , s 6 g f s 4 , s 5 g fs 1 , s 2 g fs 1 , s 2 , s 3 g fs 4 , s 5 g fs 0 , s 1 , s 2 , s 3 g fs 2 , s 3 g f s 3 , s 4 g f s 4 , s 5 g fs 2 , s 3 , s 4 g fs 5 g fs 4 , s 5 , s 6 g fs 0 , s 1 , s 2 g f s 1 , s 2 g fs 2 , s 3 , s 4 g fs 1 , s 2 , s 3 , s 4 g fs 3 , s 4 , s 5 g fs 0 , s 1 , s 2 , Diversity of services available Target Ecer, 2018;Sharma & Kumar, 2015;Spencer, Rogers, & Daugherty, 1994 c 2 Ability to provide value-added services Benefit Chu & Wang, 2012;Tsai, Wen, & Chen, 2007;Yan, Chaudhry, & Chaudhry, 2003 c 3 Information accessibility, including timeliness and reliability of information obtained Benefit Aghazadeh, 2003;Ecer, 2018;Bansal & Kumar, 2013;Yayla et al., 2015 c 4 Flexibility, ability to adapt to changing environments and to address special requirements Benefit Liu & Wang, 2009;Sharma & Kumar, 2015;Singh et al., 2018 c 5 Financial stability, exposing the continuity and reliability of services Benefit Ecer, 2018;Menon, McGinnis, & Ackerman, 1998;Sremac et al., 2018;Tsai et al., 2007 c 6 Response time to service requirements, involving delivery performance Cost Bansal & Kumar, 2013;Ecer, 2018;Sharma & Kumar, 2015;Yeung, 2006 c 7 Incompatibility, the degree of difficulty in cooperation and communication Cost Bansal & Kumar, 2013;Ecer, 2018;Jharkharia & Shankar, 2007 c 8 Willingness to bear risk, depending on the degree of risk aversion. It should not be too low or too high Target Leahy, Murphy, & Poist, 1995;Moberg & Speh, 2004;Sremac et al., 2018 Table 2. ...
In supply chain finance, the multiple criteria decision making (MCDM) problem of selecting a suitable third-party logistics (3PL) service supplier is of great significance to financial institutions. A suitable 3PL service supplier can not only help financial institutions carry out the supply chain finance business, but also can replace financial institutions to supervise the operation of a target financing supply chain, thus reducing the operational risks of financial institutions. As a useful MCDM method, the combined compromise solution (CoCoSo) method mainly combines a compromise decision algorithm with an aggregation strategy to obtain a compromise solution. This study extends the CoCoSo method to hesitant fuzzy linguistic environment to solve the multi-expert MCDM problem of the 3PL service supplier selection. Target criteria whose values are in linguistic forms are considered in the process of normalizing the decision matrix. A new integration approach with respect to subordinate compromise scores is introduced, and the subjective and objective weights of criteria are considered simultaneously in this extended process to avoid one-sidedness of criterion weights. A case study about the 3PL service supplier selection is given, in which the sensitivity analysis and comparative analysis are provided to highlight the advantages of the proposed method.
... Logistics is the process of strategically managing movement and storage of material or products and related information from any point in the manufacturing process through consumer fulfilment (Aghazadeh 2003). We can also consider it as a business support node of any strategic approach. ...
This research analyses the influence of logistic outsourcing risks management on trade performance in agribusiness distribution chain. The paper scrutinises the relationship between Manufacturer – Logistic provider – Customers (distributors). We assume that outsourcing risks management can enhance trade performance. After a pre-survey on supply chain managers using individual interviews, quantitative data were collected on a sample of agribusiness managers. We performed data analysis by structural equation modelling methods. We found that the logistic outsourcing risks management is not significantly related to trade performance. However, this relation is positive and significant through the mediation of customer service, in the presence of the logistic capabilities of provider. Hence, managers in developing country consider logistic as a resource with distinctive capability, valuable, scarce and both difficult and costly to imitate. They prefer to manage it internally in order to avoid outsourcing risks. But in France, managers prefer to outsource because their internalisation does not provide a competitive advantage.
... Meade and Sarkis (2002) argue for timeliness, quality, cost and flexibility that eventually play vital roles in selecting the service provider. Aghazadeh (2003) suggests that the selection criteria should include better relationship management that helps with stronger collaboration. Hwang et al. (2005) identified a comprehensive list of elements for outsourcing manufacturing activity such as serviceability -meeting the lead time, inventory rotation rate, production flexibility, multi-item production capability -leading to ultimate customer satisfaction. ...
This paper examines the extent to which supply chain outsourcing objectives determine the selection criteria for 3PL service providers. While the 3PL selection criteria are researched earlier, there is little understanding how they are influenced by the strategic objectives of an organisation. Using a cross-sectional survey of 297 logistics and supply chain professionals from across industries in India, structural equation modelling (SEM) analysis reveals that strategic outsourcing objectives are the likely predictor of the 3PL selection criteria. The respondents perceived higher customer satisfaction, reduction of ICT legacy systems, capital investment avoidance and access to state-of-the-art technology that influence the decision on selection of 3PL service provider. The findings provide shipper managers an insight on how to purposefully assess the selection criteria ensuring their alignment with strategic objectives of outsourcing.
... Meade and Sarkis (2002) argue for timeliness, quality, cost and flexibility that eventually play vital roles in selecting the service provider. Aghazadeh (2003) suggests that the selection criteria should include better relationship management that helps with stronger collaboration. Hwang et al. (2005) identified a comprehensive list of elements for outsourcing manufacturing activity such as serviceability -meeting the lead time, inventory rotation rate, production flexibility, multi-item production capability -leading to ultimate customer satisfaction. ...
Abstract: This paper examines the extent to which supply chain outsourcing objectives determine the selection criteria for 3PL service providers. While the 3PL selection criteria are researched earlier, there is little understanding how they are influenced by the strategic objectives of an organisation. Using a cross-sectional survey of 297 logistics and supply chain professionals from across industries in India, structural equation modelling (SEM) analysis reveals that strategic outsourcing objectives are the likely predictor of the 3PL selection criteria. The respondents perceived higher customer satisfaction, reduction of ICT legacy systems, capital investment avoidance and access to state-of-the-art technology that influence the decision on selection of 3PL service provider. The findings provide shipper managers an insight on how to purposefully assess the selection criteria ensuring their alignment with strategic objectives of outsourcing.
... This power can have many dimensions: economies of scale, process expertise, access to capital, access to expensive technology etc. By outsourcing logistics activities, firms can save on capital investment and thus reduce financial risks (Aghazadeh, 2003;Aktas & Ulengin, 2005). ...
Contemporarily, globalization causes increase in competitions and this fact leads the companies having to focus on their specialties in order to gain competitive advantage. In today's market conditions, the decision making process has become more complicated due to improvements in options, targets and environmental conditions parallel to technology. Particularly in the information technologies sector, options are increased to a great extent. The dependency of the companies to a single firm is no longer the case and the selection of the most suitable firm has become more complicated. In this study, logistics service provider selection for a company in İstanbul is selected as a decision making problem. The third party logistic (3PL) provider selection problem was modeled by one of the most frequently used multi criteria decision making method, AHP, which takes into account both tangible and intangible criteria. As a result of AHP, best alternative for 3PL provider is determined.
... For the initial screening of the logistics service providers, according to Ref. [12], supplier reputation, response to information request and references from clients are the qualitative factors that are considered. However, Aghazadeh [13], Sink et al. [12], van Damme and Ploos van Amstel [14] indicated the types of the product, prior experience of the customers experience and regulations as an essential factors in selecting service provider. Papadopoulou [15] on the other hand indicated technology, quality, expertise, leverage, responsiveness, delivery, cost, price, reputation, track record, references, balance sheet, access to capital, resources, corporate culture fit, prospects for partnership, commitment and flexibility, reputation and recommendation, area of service coverage, added value services, order processing, financial and punctuality as the criteria for selection of third party logistics service provider. ...
The research dealt with assessment of logistics service providers’ capabilities in SECs (supporting subsea engineering
companies) on the Tweneboa, Enyenra and Ntomme (TEN) project in Ghana. SECs need logistics service providers who offer
consolidated services for project optimization and fulfillment of local content requirements of the project. Relevant Staff of 7 SECs and
10 logistics service providers in Ghana formed part of the target group. The weighted scoring model was used in selecting a logistics
service provider based on certain criteria. The selection criteria included Quality, Health, Safety and Environmental (QHSE) policies
[Q], Compliance to regulations (GRA, Work permit, petroleum regulation) [C], Delivery of goods on time and response rate to deliver
[D], Vessel, Cargo attendance and transportation (sea freight and air freight) [V], and Logistics (Personal logistics and Logistics base
facilities) [L]. The study concluded Consolidated Shipping Agency (Conship) was the best Logistics Service Provider to offer the best
consolidated services for project optimization under the TEN project.
... • Supplier selection process (SSP): For example, Aghazadeh (2003) and Jain et al. (2009) who have identified five steps that need to be taken when choosing an effective TPL provider. ...
The research focus in this study is on the reselection problem of the logistics service provider (LSP). The problem was studied with one Finnish metal industry company. Our idea was to test whether the experience gained during the last eight years has changed the importance of the selection criteria and brought any new selection criteria to the table. We created a new framework in part based on the User Experience (UX) research field, which appears to be useful in the context of our study. The study is a pilot study to test the suitability of the incorporating the UX research field concepts into the logistics research field. The proposed new framework appeared to function well. The study showed that non-verifiable selection criteria require more attention than verifiable criteria. Additionally the study brought out three selection criteria that are not used in the literature as far as we know.
... Outsourcing provider selection is one of the most important steps of outsourcing process , composed of few phases, from determining selection criteria, making a list of possible providers, evaluating all possible providers, till the final selection of most appropriate partner (Keramydas et al., 2012, Aghazadeh, 2003. Selection phase has strong influence on business performance of both outsourcing partbers. ...
... This result is related to a study of Toyli et al. (2008) that a firm can reduce costs related to warehouse and inventory as long as the transportation of goods are properly managed. In addition, logistics service providers (LSP) are also contribute to reduce costs and therefore it will impact the financial performance (Aghazadeh, 2003). ...
Logistics is part of supply chain which support business activity to achieve high performance. This paper extends the previous research on the relationship between supply chain management and business performance. However, there are few research focus on assessing specific activity, such as, logistics and its relation to the business performance, especially financial performance. Previous research found that there is strong relationship between logistics and financial performance. The independent variables in this study include logistics cost, flexibility, reliability, security, service quality. Meanwhile, the dependent variable include financial performance. This study was conducted in Central Sulawesi Province by delivered 150 questionnaires, but there were 120 returned and fully completed the questionnaire. The result found that logistics cost and service quality have positive relationship to SMEs' financial performance in Indonesia. Meanwhile, flexibility, reliability and security have negative correlation to SMEs' financial performance. This paper also contributes to provide guidance in terms of relationship between logistics and financial performance in theoretical model for the managers or owner of SMEs.
... Kannan et al. (2009) develop a multi-criteria group decision-making model based on fuzzy TOPSIS in fuzzy environment to guide the selection process of best 3PRLP. Aghazadeh (2003) determine the most effective ways of choosing 3PLs. Azadi and Saen (2011) propose the approach of a new chance-constrained DEA (CCDEA) to assist the decision-makers to determine the most appropriate 3PRLPs in the presence of both dual-role factors and stochastic data. ...
In this paper, first, the criteria that make logistics service providers more “green” are determined as: cooperation with customer’s company and its customer, green government regulations, environmental management system, green process design, reduction in energy consumption and green network design. The criteria weights are determined by fuzzy AHP, based on expert opinions. Then, a new method is proposed, which is the combination of fuzzy TOPSIS and GRA, and used to evaluate green 3PLs based on different separation measures, as an extension, using trapezoidal fuzzy numbers. Five Turkish 3PLs serve in Istanbul are selected in order to apply a case study to show the applicability of the proposed method. Finally, the proposed method is verified with respect to different resolving coefficient values and separation measures and also compared with fuzzy TOPSIS and fuzzy VIKOR method results. Different multi-criteria decision-making methods can be applied and compared to check validity of our results for future studies. The proposed method can also be implemented to 3PLs in other countries.
... For the initial screening of the logistics service providers, according to Ref. [12], supplier reputation, response to information request and references from clients are the qualitative factors that are considered. However, Aghazadeh [13], Sink et al. [12], van Damme and Ploos van Amstel [14] indicated the types of the product, prior experience of the customers experience and regulations as an essential factors in selecting service provider. Papadopoulou [15] on the other hand indicated technology, quality, expertise, leverage, responsiveness, delivery, cost, price, reputation, track record, references, balance sheet, access to capital, resources, corporate culture fit, prospects for partnership, commitment and flexibility, reputation and recommendation, area of service coverage, added value services, order processing, financial and punctuality as the criteria for selection of third party logistics service provider. ...
The research dealt with assessment of logistics service providers’ capabilities in SECs (supporting subsea engineering companies) on the Tweneboa, Enyenra and Ntomme (TEN) project in Ghana. SECs need logistics service providers who offer consolidated services for project optimization and fulfillment of local content requirements of the project. Relevant Staff of 7 SECs and 10 logistics service providers in Ghana formed part of the target group. The weighted scoring model was used in selecting a logistics service provider based on certain criteria. The selection criteria included Quality, Health, Safety and Environmental (QHSE) policies
[Q], Compliance to regulations (GRA, Work permit, petroleum regulation) [C], Delivery of goods on time and response rate to deliver [D], Vessel, Cargo attendance and transportation (sea freight and air freight) [V], and Logistics (Personal logistics and Logistics base facilities) [L]. The study concluded Consolidated Shipping Agency (Conship) was the best Logistics Service Provider to offer the best consolidated services for project optimization under the TEN project.
Introduction: A key decision in logistics management from the customer's point of view is the selection of the transportation mode and carrier to move company's inbound and outbound freight. When making this decision, managers must typically consider different attributes related to cost and transit time as the primary criteria. However, the importance of individual factors often depends on the industry and company size. Moreover, even these factors may differ within a company form one facility to the next (Meixel & Norbis, 2008). 4PL selection criteria, especially the mode choice and carrier selection are part of the logistics decision making process of the 4PL customers. These include identifying relevant logistics performance variables, selecting the most suitable mode of transport and carrier, negotiating rates and level of service, and evaluating the carrier performance (Monczka, Trent & Handfield, 2005). According to Russell and Taylor (2003), transportation costs within manufacturing firms in 2003 were average 20 percent of the total production costs. Thus, no doubt these decisions are important to logistics managers.
The investment by government towards the development of freight corridors, ports and highways, increasing demand by the retail and pharmacy industry and the growth of e-commerce has driven the market to the maximum level. The present era for the shippers and the person who is involved in the logistics industry are expecting a wide range of services for getting success in their business. These shippers want a service provider who can understand the challenges which are suiting to the industry, products, customers and their organizational goals.The best 3PL service providers can provide additional services and solutions beyond the typical fulfillment and distribution services. Taking advantage of these additional offerings such as e-commerce store fronts, contact center support, accounting service, highly customized reporting and prints and mail services can save the time and money by eliminating the hassles and costs of working with multiple providers.
The relationship between stakeholders is intensive and complicated, thus, understanding the relationship between stakeholders is important for the successful management of tourism destinations. To make it viable, this paper applies network analysis and third party in stakeholder theory and explores the interest coordination mechanism of stakeholders by quantitative method. Based on the fieldwork undertaken in the Hangzhou West Lake Heritage Site (World Heritage Site) from June to September in 2018, it systematically investigated the identification, classification and interests of stakeholders. The data collection method comprised an expert panel (n = 29) and a stakeholder survey (n = 274) in finding the classification and interest of stakeholders in the most scenic spot at the Hangzhou West Lake Heritage Site, China. The results suggest two main findings: each stakeholder has a different kind of interests and these interests are hierarchical; stakeholders play different roles in the relationship network and lead to unbalanced relationships, which one party has a relationship of constraints or dependencies on the other party. Based on the findings and further, a coordination mechanism is proposed by the application of the third party as a coordinator in the social relationship network for destination tourism management.KeywordsStakeholdersRelationshipThird partyCoordination mechanism
The 3PL logistics service is primarily for all modes of transportation and storage for automobiles, Tesla Energy, batteries and/or related components to factories, service centers and other components integral to the successful operation of other Tesla companies. A 3PL (Third Party Logistics) Provider Outsourced Provides done logistics services, including one or more purchases, and Involves managing fulfillment activities. In business, 3PL means warehousing or shipping and refers to any service agreement that includes goods. The Complex Proportional Rating (COPRAS) Increase index values A reduction method is used the effect of increasing and decreasing the indices of the attributes is considered separately in the result assessment. Alternative: Operational efficiency, customer operations Integration, vertical or horizontal integration, supply chain management and Integration. Evaluation option: % of personnel in gen. mgmt and business development, % of services is value-added, Expected annual growth rate 1995-1998 in %, Competencies, Skills lacking. The result it is seen that % of services is value-added is got the first rank where as is the Competencies is having the lowest rank. The value of the dataset for Third-party logistics in COPRAS method shows that it results in % of services is value-added Decision and top ranking.
Purpose
This study discusses the influence of logistical immediacy on logistics service providers' (LSPs’) business. Specifically, its role in the face of the emerging business scenario (e-commerce, disruptive technologies, and new models of logistical services) is examined.
Design/methodology/approach
As logistical immediacy is a nascent topic, this study utilizes a systematic literature review focusing on academic articles from the last five years related to logistical outsourcing to understand the changes imposed by logistical immediacy on LSPs.
Findings
The impact of transformations arising from an increasingly digital virtual world (DVW) on LSPs is contextualized. A theoretical view of the factors affecting LSPs' shift towards more immediate operations is presented, and how logistical immediacy impacts LSPs is discussed. Finally, a research agenda is presented as the study's main contribution.
Research limitations/implications
Due to the timeframe chosen, the restriction to a single database (Scopus), the specific search terms used related to LSPs, and limiting the search parameters to operations management, some relevant work may have been overlooked.
Practical implications
The article help LSPs' and contracting companies' managers to understand the influence of the immediacy expected in logistics operations. Possible logistics services trends and how they may impact companies are discussed.
Originality/value
This is one of the first articles in the area of operations and supply chains that addresses the issue of logistical immediacy and its impact on LSPs.
Teknolojik gelişme ve küreselleşmenin bir sonucu olarak işletmeler durmadan artan bir rekabet ile karşı karşıyadır. İşletmelerin iyi bir lojistik altyapıya sahip olmaları, kaliteli hizmet sunarak müşteri memnuniyetini artırabilmeleri ve büyümeleri bu rekabette çok önemli bir rol oynamaktadır. Son dönemde yaşanan pandemi sürecinin olumsuz etkileriyle birlikte lojistiğin önemi daha da artmış olup özellikle kargo teslimat süreçleri rekabet gücünün belirleyicisi olmuştur.Bu çalışmada, e-ticaret işletmeleri için kargo firmasının seçiminde kullanılabilecek kriterlerin belirlenmesine yönelik bir araştırma gerçekleştirilmiştir. Bu amaçla, literatür incelemesi yapılmış ve uzman görüşlerine başvurulmuştur. Kargo firması seçerken dikkat edilmesi gereken önemli kriterler; fiyat, deneyim, şube sayısı, teslim süresi, personel sayısı, şikâyet sayısı, çözülen şikâyet oranı ve itibar belirlenmiştir. Belirlenen kriterlere göre kargo firmalarının değerlendirilmesinde çok kriterli karar verme yöntemi kullanılmıştır. Uygulama kapsamında, Türkiye’de tüm illerde şubesi olan 5 kargo firması belirlenmiş ve çok kriterli karar verme yöntemlerinden VIKOR yöntemi kullanılarak bu firmaların tercih edilme sıraları oluşturulmuştur. Analiz sonucunda en iyi alternatif ve uzlaşık çözüm olarak 3. Kargo firması bulunmuştur.
Supply chain complexity is reflected through the existence of multiple logistics service providers (LSPs). The decision on the appropriate logistics partner is considered significant for the chain efficiency. The managerial problem relies in the providers’ efforts to broaden their service portfolio, thus erasing controversies concerning the identification of their core competences. This issue mainly lies in the selection among an International Freight Forwarder (IFF), a Third Party Logistics Provider (3PL), and a Fourth Party Logistics Provider (4PL). The aim of this chapter is to provide an overview of the characteristics and services offered by the LSPs, present the benefits and drawbacks from the collaboration with each entity, and finally form a framework regarding their representative features. The framework is articulated based on literature review and aims to provide a guideline to the interested chain members, enabling them to assess their needs against the LSPs’ characteristics.
Many companies outsource their logistics functions to Third-Party Logistics providers (3PL) instead of achieving them internally. The studies on this field are mostly of empirical type and focused on reasons, benefits, and risks of working with 3PL as well as the role of those on supply chain management. This chapter focuses on 3PL selection problem and presents a literature analysis of 47 articles published within 2001-2011 period. The objective is to identify the mainly approaches applied and their evaluating criteria in measuring the performance of 3PL.
Third party logistics (3PL) has been gaining importance in most places in the world. In India the implementation of 3PL practices has made its beginning and it is emerging as one of the fastest growing sectors. It is still a relatively new concept and not well understood among industry or academic professionals in India. This paper examines the Indian 3PL Supply Chain Management and practices with respect to the key success factors and growth strategies. After identifying the critical success factors SERVQUAL is applied to reveal the gap between their achievement and expectation. Respondents to the survey are categorized based on their rating of the key growth strategies on the basis of AHP.
Many companies outsource their logistics functions to Third-Party Logistics providers (3PL) instead of achieving them internally. The studies on this field are mostly of empirical type and focused on reasons, benefits, and risks of working with 3PL as well as the role of those on supply chain management. This chapter focuses on 3PL selection problem and presents a literature analysis of 47 articles published within 2001-2011 period. The objective is to identify the mainly approaches applied and their evaluating criteria in measuring the performance of 3PL.
Purpose
The purpose of this research is to first explore various third party logistic service provider supply chain enablers. Thereafter the interrelationship amongst the various supply chain enablers has been studied using ISM Methodology. Despite the complex relationships third party logistic service providers (3PLs) share with their clients or firms, they often attract a demand owing to the flexibility and competitive edge they provide to their client firms in adapting to the rapidly changing market conditions, focusing on their core competencies and developing long-term growth strategies for them. Choosing and evaluating the right third-party logistic service provider is an important responsibility for logistic managers. This largely depends on selecting appropriate 3PLs supply chain enablers that assess the 3PLs on different fronts.
Design/methodology/approach
This paper presents an ISM approach for studying the interrelationships between various 3PLs enablers and accordingly constructing a hierarchical structure of them.
Findings
The results suggest that delivery, service reliability and risk and uncertainty factors have the highest importance.
Research limitations/implications
Selection of the 3PLs is a critical issue when they are required to be selected by the company at the global level. This often requires doing a comparative study for both domestic as well as global service providers. Choosing appropriate supply chain enablers as the basis for selection of 3PLs therefore will serve as a research topic to be further explored both by researchers as well as company managers. Further studying the inter-relationships amongst various supply chain enablers will provide basis to managers to justify their choice.
Originality/value
The novelty of the research lies in the application of methodology to the case of third-party logistic service provider selection
Due to globalization and fast growing e-commerce businesses, the scale of Logistics Service Providers (LSPs) in India is expected to increase. LSPs support their client organizations to provide a smooth and timely delivery of goods. LSPs provide flexibility in their processes to meet the dynamic requirements of their customers. In this chapter, there is an attempt to identify the best practices followed by Indian LSPs and to rank the identified best practices. The best practices have been categorized into four major categories, that is strategic, operational, technical, and societal, based on literature review and opinion of experts. Further, twenty best practices were identified as subcategories under above-defined categories. The experts were asked to rate the 20 factors as per their importance. Further, to rank the best practices, a fuzzy AHP approach was applied. Based on priority weights, different categories were ranked in decreasing order as Operational (0.45), Strategic (0.41), Technical (0.10), and Societal (0.03). It has been observed from the study that the top 4 most important factors among all the 20 factors are safe delivery of shipments, use of eco-friendly fleet, reduction in carbon emission, and timely delivery. The study is likely to assist organizations in familiarizing with the strengths and practices used by Indian LSPs so that they can set up their perceptions and expect for their fulfillment. The research is also expected to help unorganized and budding LSPs to recognize their weak factors, which require further improvement and can excel to fulfill the dynamic market needs.
Third-party logistics (3PL) services have seen significant growth in recent years as a result of playing a key role in supply chain management. The demand for 3PL service providers has increased as companies offer better service to their customers, lower costs and gain competitive advantage. This paper includes an application that will help determine the most important criteria in the selection and evaluation of 3PL service providers. The aim of the paper is to be able to determine the selection criteria of the 3PL service providers and the relationships between them, from the point of view of companies already using logistics services outsourcing. For this purpose, grey system theory and DEMATEL approach are integrated in order to describe uncertain and complex decisions with definite numerical values and determine the relations and importance levels between the criteria. The findings revealed interrelations between criteria and presented the most important criteria for 3PL provider selection. It is believed that the results of the paper will help the managers to propose a model that can be implemented with the selection criteria of the 3PL service provider.
For 30 years, supply management academics have demonstrated extensive interest in relations between sellers and buyers of logistics services. This interest can be explained by the development of outsourcing strategies by manufacturers and large retailers, which has given rise to powerful logistics service providers. Prior research favors a holistic vision, based on the management of supply chain interfaces between companies, without addressing the perspective of the purchasers of logistics services. This paper aims to understand better the intention of individuals to purchase logistics services based on factors related to attitudes, norms, and behavioral control. For this purpose, the authors rely on the theory of reasoned action and the theory of planned behavior, both used in social psychology to analyze human behaviors, and propose a simplified reasoned action model for logistics services purchasing.
Résumé
Depuis une trentaine d’années, de nombreuses recherches académiques sont menées dans différents champs disciplinaires du management concernant les relations interentreprises nouées au sein des chaînes logistiques. Ces recherches adoptent principalement une vision holistique du management des interfaces au sein des chaînes logistiques, l’unité d’analyse restant principalement l’organisation ou la relation. En revanche, très peu de travaux académiques étudient les équipes ou les individus en situation d’interface, que ce soit les commerciaux (vendeurs) au sein des entreprises spécialistes de la prestation logistique (PSL), ou les acheteurs (qu’ils appartiennent à la direction des achats, de la logistique ou de la supply chain) au sein des entreprises clientes. L’objectif de l’article est de proposer une lecture originale de l’intention individuelle d’un professionnel qui se retrouve en situation de participer au processus d’achat de prestations logistiques. Les auteurs s’appuient pour cela sur la théorie du comportement planifié (theory of planned behaviour), mobilisée tout particulièrement en psychologie sociale pour analyser la dynamique des comportements humains.
Due to advancement of technology and globalization, the organizations are giving more importance to the supply chain integration, taking support from logistics service providers (LSPs) and practice several initiatives in direction of sustainability. The assets, processes and performance capabilities of LSPs can be used as an indicator to comprehend and evaluate effective and sustainable service quality management. In this article, there is an attempt to understand and analyse all important components required by LSPs to serve their customers with best quality of services. A comprehensive framework is proposed for evaluating the services of logistics providers. The services are evaluated on the basis of LSPs assets, processes, service quality attributes and sustainable performance parameters. A case study on Indian logistics service provider is taken to support the proposed framework in a real scenario. The assets and processes in context to given case organization are discussed in detail. The service quality index is also evaluated for estimating the quality of services of firm by taking inputs from their customers. After discussing service quality analysis, the performance analysis is done along with SWOT Analysis. Findings of the study will help professionals in developing appropriate strategies for effective and sustainable supply chain management.
Purpose
The concept of third-party logistics service provider (3PLSP) has been considered as an essential organizational philosophy to achieve profits. The purpose of this paper is to analyze and examine the contextual relationship among the critical success factors (CSF) of 3PLSPs practices in the cement manufacturing industry.
Design/methodology/approach
In this paper, the total 20 critical selection criteria with nine processes for the 3PLSPs, of an Indian cement manufacturing industry have been identified through an exhaustive literature review and opinions of the experts i.e. academics and industries. Interpretive ranking process (IRP) methodology has been presented to find out the rankings of the individual criteria and the mutual influence in the selection process.
Findings
The proposed model establishes the dominance of relationship among identified criteria, which plays a vital role in the 3PLSPs selection process which are experience in similar product, quality of management, information technology capacity, flexibility in operation and delivery, compatibility with the users.
Research limitations/implications
An empirical research approach has not been used to collect primary data to rank different criteria for effective 3PLSPs implementation in the Industry. In this paper, an example of Indian cement industry is presented to show the real world applicability of the proposed model.
Originality/value
This model would help a decision maker to decide the issues related to a selection of 3PLSPs. The third party service provider comprises the use of external companies who controls and delivers logistic activities. The paper discusses very practical issues in an analytical manner, using the case base method.
A key decision in logistics management from the customer’s point of view is the selection of the transportation mode and carrier to move company’s inbound and outbound freight. When making this decision, managers must typically consider different attributes related to cost and transit time as the primary criteria. However, the importance of individual factors often depends on the industry and company size. Moreover, even these factors may differ within a company form one facility to the next (Meixel & Norbis, 2008). 3PL selection criteria, especially the mode choice and carrier selection are part of the logistics decision making process of the 3PL customers. These include identifying relevant logistics performance variables, selecting the most suitable mode of transport and carrier, negotiating rates and level of service, and evaluating the carrier performance (Monczka, Trent & Handfield, 2005). According to Russell and Taylor (2003), transportation costs within manufacturing firms in 2003 were average 20 percent of the total production costs. Thus, no doubt these decisions are important to logistics managers.
Investigates three aspects of human resource management facing future challenges, personnel, technology and globalization. Suggests that the human resource professionals in a successful business must be able to attract and retain individuals who have the ability to manage a globally responsive business. Covers the use of technology for competitive advantage; advocates global strategies in operations management and empowerment of the individual.
Highlights insights gained from five years of operating experience in a logistics partnership between a large US retailer and a provider of international logistical service. The insights gained from this partnership show that a third-party logistics provider can help a firm achieve substantial results. The path to achieving these results is not without its difficulties, but many of these problems can be anticipated and appropriate actions taken to minimize their disruption. Establishing a measurement system that allows easy and integrated reporting of the status of the enterprise is essential if real progress is to be made in a logistics partnership. An extensive formal and informal communication strategy is essential to address the issues arising from the difficulty of combining two different organizational cultures. Finally, this partnership has shown that if the rewards for both partners are real, tangible, and substantial the partnership can endure.
The inventory management system of a discount retail store was examined. A just-in-time inventory management model and a quantity discount model were used to determine the appropriateness of each model for the retail outlet. Based on the calculations performed, it was determined that utilizing a retail just-in-time (JIT) policy is unrealistic. Customer demands constantly change, and shortages due to stock-outs can cause huge losses in profits, especially when customers are lost to competitors. Additionally, the quantity discount model provides the lowest total cost for a retail outlet. Not only are the prices cheaper when inventory is bought in large quantities, but shortages or stock-outs are rare. The optimal solution for a retail store is implementing the quantity discount method.
The selection of third-party logistics providers is an intriguing practical and research question. With the development and advancement of reverse logistics concepts and practice, the selection of partners for the specific function of reverse logistics support becomes more important. This paper is one of the first to address this issue. The factors that play an important role in selecting a third-party reverse logistics provider; such as a focus on end-of-life product organizational roles (e.g. recycling, reuse, etc.), differ from some traditional factors for supplier selection. How these new factors can be included for the selection of a partner is modeled within a decision-making framework.
Mass customization poses a challenge to the development of competitive supply chains. Third-party logistics service providers are targeting customizing operations to supplement their transport and warehousing services. Their expansion is driven by strategies for adding value and upgrading customer relations. This article assesses the development of these relations by presenting the results of a survey conducted among service providers. The assessment covers the nature of the purchasing policy and governance structure applied in this particular type of interfirm relations, including the type of services, contracts, frequency, level, and content of coordination and communication among parties in the chain. It was found that the new transactional context does not represent a market environment in which third parties can escape traditional arm's-length fixed contracts. It was also found that supplementary customizing services are not often applied. Recommendations are made about purchasing these services and about initiatives for third parties to start expanding their competence within the governance structure.
In this article we have expanded Professor James Cooper's discussions of 'mega carriers' for one-stop shopping of logistics services to a multi-tiering model to describe different alliances in third-party logistics. To be able to support the increasing demands of shippers, a third-party logistics provider must have a portfolio with many different services, either in-house or available from a supplier network. As a consequence, third-party logistics cannot be reduced to an alliance between a single shipper and a single provider. Both the shipper and the provider are also involved in other alliances and these often strongly interact with the shipper-provider relationship. Furthermore, this relationship varies across the different phases of third-party logistics projects: design, development, implementation, and operation. Therefore, in order to broaden the picture and to extend the modelling of Cooper and others, we suggest a five-layer model with users and four tiers of logistic service providers for the description and analysis of logistics and transport industry issues in general and third-party logistics in particular. This conceptual model is then illustrated and validated by a case study describing the implementation of an alliance which involved the redesign of a European distribution operation for service parts.
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