Adding value thruogh outsourcing: Contribution of 3PL services to customer performance

This paper is based on the research we undertook to understand the state of the 3PL (Third Party Logistics) industry in Australia. To this end, we surveyed both the logistics service providers and their customers in Australia. This study builds on the work of three previous studies conducted within the Australian 3PL industry. This paper is confined to the customer survey. One of our aims in this research was to understand how customers perceive their logistics service providers in terms of achieving the claimed benefits of outsourcing. We identified some of the business outcomes to which logistics outsourcing is expected to contribute. Customers were asked to rate their principal 3PL's contribution to these performance indicators. We used the 3PLs competitive priorities, the services provided by them and technologies used by them as predictors and performed regression analysis for each of these. We present the results on how customers value their service providers as contributing to their performance.