Logistics Service Providers Outsourcing

It is apparent that when the need for customization is high, LSPs that are highly accomplished in providing advanced services can satisfy customer needs by creating sophisticated and individualized services. At the other extreme, customers with low customization needs may contract with LSPs that provide simple standard services. 

Rabinovich and Knemeyer (2006) suggest a different classification of LSPs using two dimensions service form (information based, and physical-asset based), and service focus (buyer focused, supplier focused, and delivery focused). This creates six clusters of LSPs, shown in Fig. 5.20. 

Physical-asset-based LSPs compete based on transportation assets and/or warehousing assets. The information-based LSPs, on the other hand, create 

Process Efficiency High Sophisticated interchangeable modular services Creating knowledge-based individualized services 

Physical-asset Based Order-returns Order consolidation Picking/Packing 

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Figure 5.4 Methods used to assess an outsourced logistics services provider Source Own study.

The transportation strategy states, for example, whether the transportation of goods is outsourced to a logistics service provider or performed by the firm itself. Moreover, it records the transportation mode such as tmcking, railroads, air transportation, or water transportation. 

Keywords outsourcing. Supply Chain Management, logistics service provider, chain orchestration, food industry... 

However, most district companies are not large enough to become attractive propositions for IT or logistics service providers. While they cannot afford to lose outsourcing... 

The next question regarded threats resulting from outsourcing logistics operations. Problems most frequently arise (Table 4.3) from a low level of services provided by logistics companies. Another unfavourable factor is the cost increase and problems in communication with the... 

Figure 5.5 Methods used by companies to solve problems resulting from cooperation with an outsourcing company providing logistics services Source Own study.

The public sector and government organizations are engaged in initiatives to improve the performance of their service supply chain and reaching out to the experience of global service providers such UPS, FedEx and DHL. The national institution of National Health Service (NHS) in the UK which is known to be an icon of self-contained healthcare services has formed an outsourcing service supply chain parmership with DHL Logistics. 

Butner, K., Moore, D. (2006). Building value in logistics outsourcing The future of the logistics provider industry. New York IBM Business Consulting Services, IBM Institute for Business Value, IBM Global Services. 

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