Horizontal cooperations between logistics service providers: motives, structure, performance

Abstract

Purpose-This paper aims to provide a comprehensive overview of the motives, structure and performance attributes of horizontal cooperations between logistics service providers (LSPs). Based on an analytical classification model, distinctive types of logistics cooperation that characterize the logistics landscape are identified. Design/methodology/approach-Empirical data were collected on horizontal LSP cooperations from managers of German LSPs. Different uni-and multi-variate statistical methods including ANOVA and cluster analysis were applied to the dataset of 226 cooperations for a total of 6,081 involved parties. Findings-Horizontal cooperations with other LSPs are an organizational form used by 57 percent of LSPs. Cooperation decisions are substantially driven by external market objectives. Six distinctive types of cooperation are identified. They reveal the dominance of multilateral and international networks that are mainly based on contractual agreements. There is a clear preference for partners with similar market competencies and for strong functional integration. Despite its inherent complexity, performance of these cooperations is high-its less than 19 percent failure rate makes these cooperations substantially more stable than cooperations within manufacturing industries. Research limitations/implications-This study is limited to an exploratory, descriptive approach in providing a sound understanding of the cooperation landscape. Practical implications-The findings contribute transparency to horizontal LSP cooperations and a common understanding of their idiosyncrasies. The conclusions help logistics managers to position themselves better within the cooperation landscape. Further, the analyses offer managers a conceptual classification of horizontal LSP cooperations and some guidance on how to structure their individual LSP cooperations more successfully. Originality/value-This paper is the first empirical study that defines the types of cooperation that comprise the logistics cooperation landscape. The analysis integrates a holistic perspective of their contractual, organizational, functional, geographical, service and resource scope and matches them with underlying motives and performance attributes.

Integrating intermodal transport with logistics: a case study of the UK retail sector

“…The subject of retail intermodal logistics includes the retailers themselves as well as rail operators and third-party logistics providers (3PLs). Schmoltzi & Wallenburg (2011) found that while almost 60% of 3PLs in their study operated at least one horizontal partnership with other 3PLs, the failure rate was below 19%, against an average failure rate for horizontal collaborations in many industries ranging from 50% to 70%. The authors also found that, while horizontal collaboration might be thought to be based on cost reduction, the primary motivations revealed in their study were service quality improvement and market share enhancement.…”

Performance measurement in horizontal LSP cooperation as a field of conflict: the preventive role of collaborative processes

“…Inter-organizational relationships, where parties with different corporate cultures, different regions, different mindsets, and different ways of doing things interact intensively, provide fertile ground for such conflicts [18,29]-a situation typical for horizontal LSP alliances [3]. Further factors that create tension and almost inevitably lead to conflicts are mutual dependencies that require continuous interactions [30], different viewpoints concerning temporal aspects (i.e., short-term vs. long-term) [31], diverging goals, and, in the specific case of horizontal cooperation, competitive tension [31,32] among members.…”

“…Compared to vertical relationships, the mode of collaboration in horizontal alliances differs due to their often multilateral setup [3]. This complicates collaborative processes as more than two companies are to be included.…”

“…Examples are multicompany networks for less-than-truck-load transportation. Today, more than half of all small, medium, and large LSPs are engaged in at least one such horizontal alliance with one or multiple other LSPs [3]. This allows them to strengthen their competitive position through improved service scope and quality, increased productivity, and access to new markets [1,3,4].…”

Using a “virtual joint venture” to facilitate the adoption of intermodal transport

“…Cai et al (2009) Todeva & Knoke (2005) developed a 13-stage model of cooperation structure capturing the spectrum from market/contract to hierarchy/integration: market relations, action sets, industry standard groups, subcontractor networks, licensing, franchising, cartels, strategic cooperative agreements, R&D consortia, cooperatives, equity investments, joint ventures, hierarchical relations. Schmoltzi & Wallenburg (2011) condensed these hybrid types (and other previous work by Parkhe, 1991;Dussauge & Garrette, 1997;Klint & Sjöberg, 2003) into four: verbal agreements, written contracts without equity involvement, minority stake agreements, joint venture agreements. Thus the key element in that formulation is the level of the financial stake taken by the partners.…”