The Supply Chain Role of Third-Party Logistics Providers

Outsourcing, the strategy in which organizations employ the services of external providers, has attracted growing interest. Academic and industrial attention has also focused on the role of seamless supply chain processes in achieving and sustaining competitive advantage. This research is based on petrol retailers in the UK that have adopted logistics outsourcing strategies for implementing supply chain solutions to their convenience-goods operations. Its aim is to identify the factors, which influence outsourcing decisions and the nature and supply chain implications of outsourcing strategies. Research findings indicate that the capability of service providers to facilitate supply chain solutions is largely influenced by four main factors, which in turn substantially determine their role in the supply chain: the strategic orientation of the outsourcing organization; its perception of service providers' role within the logistics strategy; the nature of the resultant client-provider relationship; and, the extent to which the logistics process is outsourced.