Third‐party logistics providers in Spain

Abstract

Purpose -Companies consider logistics outsourcing for strategic reasons, and build close-knit relationships with third-party logistics (3PLs) providers. The purpose of this paper is to analyse logistics outsourcing in Spain from the viewpoint of 3PLs. Design/methodology/approach -The paper suggests three propositions and conducts a case study of four 3PLs in Spain, chosen because of their market coverage and their range of services. Findings -The results identify the main reasons why companies choose to outsource logistics, what kind of relationship they build with providers, and how much involvement in the management of their supply chain they seek from providers. Practical implications -Most companies in Spain continue to outsource mainly on the basis of costs, and do so tactically. However, the option of developing an alliance with a 3PL provider is not always more economical, as cost reduction is due more to optimisation of the supply chain than to outsourcing itself. Based on the experiences of the four 3PLs providers under analysis, the paper makes a set of recommendations for senior management in the sector. Originality/value -The research helps to fill an existing gap in the study of logistics outsourcing in Spain because it analyses logistics outsourcing from the perspective of the 3PLs provider and not from the viewpoint of the outsourcing organisation, as the vast majority of the studies conducted in Spain have done to date.

Quintessence of third party (3PL) logistics

“…For example, Aguezzoul (2014) discusses the 3PL industry scenario in China. Nunez-Carballosa and Guitart-Tarres (2011) discuss how Spanish 3PL companies outsource transport on cost considerations rather than strategic outsourcing. This implies that 3PL companies are outsourcing as a tactical strategy rather than a collaborative strategy.…”

“…Modularity theory (Cabigiosu et al , 2015) and RBV (Zacharia et al , 2011) have been used as major theoretical lenses to address the problem context whereas saturation theory (Nunez-Carballosa and Guitart-Tarres, 2011) has been cited to cater to methodological rigor within the case study approach. Principal-agent theory (Lin et al , 2013) is the only theory that has been explicitly mentioned by researchers while building mathematical models.…”

Exploring the impact of outsourcing on organizational performance

“…Adopting service or material outsourcing is a strategic decision because it positively enhances financial performance of the firm (Boyson et al, 1999;Wilding and Juriado, 2004;Hsiao et al, 2010;Merino and Rodríguez-Rodríguez, 2007), makes the business more flexible (Sahay and Mohan, 2006;Arias-Aranda et al, 2011;Núñez-Carballosa and Guitart-Tarrés, 2011), quality of customer service is improved (Sum et al, 2001;Sohail and Sohal, 2003) and there is improvement in productivity and many more (Razzaque and Cheng, 1998;Sum et al, 2001;Sahay and Mohan, 2006). The adoption of outsourcing also allows a firm to get access to new skills and novel technologies (Boyson et al, 1999;Wilding and Juriado, 2004;Sahay and Mohan, 2006;Núñez-Carballosa and Guitart-Tarrés, 2011) and to expand to increase their market share (Sink and Langley, 1997;Fernie, 1999) and gives the firm the chance to concentrate on its core competencies (Bhatnagar et al, 1999;van Laarhoven et al, 2000;Bustinza et al, 2010;Hsiao et al, 2010).…”

An integrated framework for outsourcing risk management

“…The shift of power-based orientation to governance structure to build up trust (Tian et al, 2007) and tight collaboration can enhance outsourcing management. Similarly, cooperative strategic logistics outsourcing is also advocated by researchers instead of tactical outsourcing which focuses on cost only (Wang et al, 2010;Núñez-Carballosa and Guitart-Tarrés, 2011). In fact, outsourcing has become very widespread in the last decade and it changes from peripheral business functions in the past, to more vital business functions being IMDS 112,4 outsourced today (Tafti, 2005;Yang et al, 2008).…”

“…The shift of power-based orientation to governance structure to build up trust (Tian et al, 2007) and tight collaboration can enhance outsourcing management. Similarly, cooperative strategic logistics outsourcing is also advocated by researchers instead of tactical outsourcing which focuses on cost only (Wang et al, 2010;Núñez-Carballosa and Guitart-Tarrés, 2011).…”