Financial statement analysis of logistics service providers: ways of enhancing performance

Abstract

2013),"Exploring the integration of sustainability and supply chain management: Current state and opportunities for future inquiry"Abstract Purpose -Despite the relevance of financial information relating to logistics service providers (LSPs), recent research has paid little attention to the financial analysis of LSPs. The aim of this paper is to examine the balance sheet structure of LSPs in order to find out if there are differences between single providers or defined LSP groups (clusters), respectively. Furthermore, the dependency of asset, capital and liquidity structures on LSPs specific characteristics is pointed out. Finally, we show which financial indicators positively influence profitability. Design/methodology/approach -A total of 150 quoted LSPs from all over the world, allocated to six different clusters depending on scope of service were examined. A detailed balance sheet analysis using contingency theory, complemented by a correlation analysis, provides information about the financial structure, similarities and differences within and in-between the LSP clusters. Findings -It was found that there are many differences regarding the financial structures of LSPs. The asset and liquidity structure of LSPs show significant differences, while the capital structure is mostly homogeneous. Profitability is achieved in various ways: Focusing on high net profit margin or asset turnover rates. Research limitations/implications -Only quoted LSPs are analyzed. With this broad research approach the authors point out the range of possibilities for financial statement analysis of LSPs and demonstrate the potential for future research. Practical implications -Financial analysis yields information for making strategic decisions including organic growth, outsourcing, mergers and acquisitions or cooperation between LSPs. Originality/value -This paper contributes to further performance examinations of LSPs by providing a profound financial statement analysis with potential benefits for logistics executives, analysts and researchers.

Logistics service providers and corporate social responsibility: sustainability reporting in the logistics industry

“…Increase in the outsourcing of logistics services and intense competition in the 3PL market, has led to a broadened scope of services offered by LSPs aiming to satisfy requirements of a wide range of customers (Sum and Teo, 1999, Marasco 2008, Busse and Wallenburg, 2011, Hofmann and Lampe, 2013. At the same time LSPs are constantly challenged with changes in their respective market environments, such as globalisation, deregulation and increasing competition (Marasco 2008, Busse andWallenburg, 2011), rapid progress in information processing and communication technology (Marasco, 2008), growth of e-commerce (Delfmann et al, 2002), widespread application of just-in-time strategy (Marasco, 2008), increasing importance of knowledge-based consulting services and need for establishing cooperation with other LSPs (Hofmann and Lampe, 2013), as well as pressures to lower their environmental impact (Wolf and Seuring, 2010). The term LSP covers a very diverse range of companies.…”

Understanding the cost of capital of logistics service providers: an empirical investigation of multiple contingency variables

“…As a key result, they found that the influence of microeconomic variables on stock returns varies among the LSP industries. The influence of an LSP's industry (on the SIC basis) on its financial statement was analyzed by Hofmann and Lampe [21]. They revealed that the industry largely influences an LSP's financial structure, which is also closely linked to its stock price and CoC.…”

“…• Second, LSPs show completely different financial structures [21]. For example, asset intensity (ratio of non-current assets to current assets) and the affiliated fiscal structure vary regarding both the general strategic orientation (e.g., ''asset-light'' vs. ''asset-based'' approaches) and the form of corporate funding (e.g., debt-vs. equity-based funding).…”

“…At present, it is unknown whether the appropriate findings of previous studies are also valid for LSPs or whether specific patterns can be observed. Based on recent findings in financial logistics research, which indicate significant differences in the financial structure of LSP industries [21][22][23][24][25][26] and also a higher exposure of LSPs to (financial) risks than other industry companies [27], we expect significant differences for the analyses of the leverage of company, industry, and market characteristics on the CoC and the systematic risk of LSPs.…”

“…Initial approaches were followed by Hofmann and Lampe [21], who analyzed the financial structure of LSPs, and Liu and Lyons [22], who investigated the relationship between the financial performance and service capabilities of LSPs. Comparable analyses were made by Töyli et al [23], Panayides [24], Panayides and So [25], and Ellinger et al [26].…”