What Drives the Choice of Third Party Logistics Provider?

40 Pages Posted: 5 Oct 2008

See all articles by Edward J. Anderson

Edward J. Anderson

University of Sydney Business School

Tim Coltman

University of Wollongong - Faculty of Business (BUS)

Timothy M. Devinney

University of Manchester - Alliance Manchester Business School

Byron Keating

University of Canberra - Faculty of Business, Government and Law; University of Wollongong - Faculty of Business (BUS)

Date Written: October 2, 2008

Abstract

The service value proposition plays a key role in defining the most appropriate mix of components in service operations management. However, service companies often find it difficult to obtain a good understanding of how customers differentially value the service components that are offered by different providers. In this paper we identify the factors that are important to the choice of a logistics service provider. We use a stated choice experiment to explore the relative importance of seven service attributes based on a sample of 309 individuals across a range of industries and countries who have a role in purchasing logistics services. The results show that three distinct types of behavior populate our data and the preferences for price, delivery performance, service recovery, relationships, capacity, innovation and professional knowledge varies greatly between these customer groups. The practical importance of this insight is that we provide a logical starting point from which managers can begin to reverse engineer their service operations.

Keywords: Third party logistics, Service elements, Choice modelling, Survey research

Suggested Citation

Anderson, Edward J. and Coltman, Tim and Devinney, Timothy M. and Keating, Byron, What Drives the Choice of Third Party Logistics Provider? (October 2, 2008). Available at SSRN: https://ssrn.com/abstract=1277184 or http://dx.doi.org/10.2139/ssrn.1277184

Edward J. Anderson

University of Sydney Business School ( email )

Cnr. of Codrington and Rose Streets
Sydney, NSW 2006
Australia

Tim Coltman

University of Wollongong - Faculty of Business (BUS) ( email )

Building 40A, Level 2
NSW, 2522
Australia
+61 (2) 4221 3912 (Phone)
+61 (2) 9313 7279 (Fax)

Timothy M. Devinney (Contact Author)

University of Manchester - Alliance Manchester Business School ( email )

Booth Street West
Manchester, M15 6PB
United Kingdom

Byron Keating

University of Canberra - Faculty of Business, Government and Law ( email )

University Drive
Bruce, 2617
Australia

University of Wollongong - Faculty of Business (BUS) ( email )

Wollongong, 2520
Australia

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