Third-party Logistics Service Research Articles

Managing disruptions and strategy development during Covid-19 pandemic: the perspective of third-party logistics service providers (3PLs)

ABSTRACT The Covid-19 pandemic forced many companies to alter and improve their logistics activities as part of their business logistics strategies, to obtain cost and service advantages. In this regard, to lessen the detrimental effects on the business environment, it is critical to develop different strategies according to the nature of the disruptions and uncertainties. This paper explores uncertainty sources confronted by third-party logistics service providers (3PLs), identifies disruptions, reveals the resources used to cope with these and develops strategies for the Covid-19 pandemic. Drawing upon Resource Orchestration Theory (ROT), we reveal the important role of resource allocation in logistics and supply chains (SCs). This study proposes a conceptual framework that describes resources which can be used for strategy development in the face of uncertainties. In terms of managerial implications, this study extends knowledge in the field by providing insights enabling 3PLs to improve their capabilities and increase their performance.

An exploratory study of organisational and industry drivers for the implementation of emerging technologies in logistics

PurposeEmerging technologies have the capacity to transform industries offering substantial benefits to users. Given the increasing demand for advanced logistics services, third-party logistic service providers (LSPs) face greater pressure to deploy and realise these technologies, especially given the demands and operational challenges created during the COVID-19 crisis. Drawing upon the diffusion of innovation (DOI) theory and technology–organisation–environment (TOE) framework, this paper goes beyond just identifying drivers and barriers to technology adoption to understanding how LSPs and industry experts perceive these drivers and barriers and simultaneously confront and undertake actions to implement them.Design/methodology/approachAn exploratory study was conducted in three phases: (1) in-depth interviews with twelve stakeholders in the Australian logistics industry; (2) five in-depth interviews conducted with stakeholders during the COVID-19 crisis and (3) a focus group discussion session. All interviews were analysed using content analysis and revealed several drivers for the deployment of emerging technologies, including internal organisational factors that drive supply chain (SC) network optimisation.FindingsThe analysis of the three phases identified several drivers for the deployment of emerging technologies in logistics, including internal organisational factors that drive SC network optimisation. Also identified were external drivers including the impact of the COVID-19 crisis, along with barriers and specific actions that were considered and implemented by LSPs for sustainable operations, particularly in a post-COVID-19 environment.Originality/valueThis study explores organisational and industry drivers for the implementation of emerging technologies. Explicitly, it extends the extant research by highlighting organisational and industry drivers and enablers that influence adoption and deployment of emerging technologies. Second, it advances the existing perspectives on LSPs in the Australian context on the development and implementation of technology strategies. The paper offers insights around implementation of technologies, directly obtained from industrial application for managers and practitioners.

Logistics Service Selection Strategy of Green Manufacturers in Green Low-Carbon Supply Chain

In order to analyze the logistics service mode and sales mode selection strategy, a green low-carbon supply chain consisting of a single manufacturer and a single e-commerce platform is considered. First, in the green low-carbon supply chain which consists of a direct selling channel and reselling channel, the selection strategy of the manufacturer's logistics service mode is analyzed. Second, in the green low-carbon supply chain which consists of a direct selling channel and an agency channel, the selection strategy of the manufacturer's logistics service mode is analyzed. Last, the manufacturer's sales mode is analyzed. We use the backward induction method to solve the theoretical model. This study contributes to the literature by considering the optimal decision of a green low-carbon supply chain. This study brings together the literature from streams on the selling channel selection strategy in green supply chains and the logistics service strategy in green supply chains. The impacts of the logistics service cost, the selling cost, and the green input cost coefficient on the optimal decision and the firms' profit are discussed. The result shows that in the direct selling channel and reselling channel, when the basic market demand and the logistics service level of the third-party logistics service provider are low, manufacturers will choose the e-commerce platform logistics service; in the opposite case, manufacturers will choose the third-party logistics service. In the direct selling channel and agency channels, when the logistics service level of the third-party logistics service provider is greater than or equal to a certain critical value and less than or equal to the logistics service level of the e-commerce platform, manufacturers will choose the e-commerce platform logistics service; in the opposite case, manufacturers will choose the third-party logistics service. No matter whether the manufacturer chooses the logistics service provided by the third-party logistics service provider or the logistics service provided by the e-commerce platform, the manufacturer should choose the direct selling channel and the agency channel.

Toward resilient cloud warehousing via a blockchain-enabled auction approach

Cloud warehousing service (CWS) has emerged as a promising third-party logistics service paradigm driven by the widespread use of e-commerce. The current CWS billing method is typically based on a fixed rate in a coarse-grained manner. This method cannot reflect the true service value under the fluctuating e-commerce logistics demand and is not conducive to CWS resilience management. Accordingly, a floating mechanism can be considered to introduce more flexible billing. A CWS provider lacks sufficient credibility to implement floating mechanisms because it has vested interests in terms of fictitious demand. To address this concern, this report proposes a blockchain-enabled floating billing management system as an overall solution for CWS providers to enhance the security, credibility, and transparency of CWS. A one-sided Vickrey–Clarke–Groves (O-VCG) auction mechanism model is designed as the underlying floating billing mechanism to reflect the real-time market value of fine-grained CWS resources. A blockchain-based floating billing prototype system is built as an experimental environment. Our results show that the O-VCG mechanism can effectively reflect the real-time market value of CWSs and increase the revenue of CWS providers. When the supply of CWS providers remains unchanged, allocation efficiency increases when demand increases. By analyzing the performance of the O-VCG auction and comparing it with that of the fixed-rate billing model, the proposed mechanism has more advantages. Moreover, our work provides novel managerial insights for CWS market stakeholders in terms of practical applications.

Research on the Coordination of Fresh Food Supply Chain Based on the Perspective of Blockchain and Low Carbon

We consider a three-stage fresh agricultural product supply chain consisting of a supplier, a third-party logistics service provider (TPLSP), and a retailer and discuss the coordination mechanism of “revenue sharing + double cost sharing” contracts and “two-part tariff + revenue sharing + double cost sharing” contracts between the supplier, TPLSP, and the retailer. Based on this, we not only explore the conditions for supply chain full coordination and Pareto improvement but also analyze the effect of blockchain technology application cost, consumer environmental protection awareness, freshness preference, green trust level on carbon emission reduction level, fresh-keeping effort level, price decisions, and profits by comparing three different decision-making models. Results show that the improvement of the green trust level can help to improve the carbon emission reduction level, fresh-keeping effort level, price decisions, and profits. The application of blockchain technology can reduce transaction costs and improve consumer green trust levels, thereby increasing market demand and profits. When environmental protection awareness and freshness preference are higher than a certain value, the unit retail price of fresh products under decentralized decision-making is the highest with the blockchain technology applied. TPLSP can increase the wholesale, service, and retail prices of fresh products by appropriately increasing the blockchain technology application cost-sharing ratio. When 15 < T 1 < 29.2416 and 47 < T 2 < 66.0408 , “two-part tariff + revenue sharing + double cost sharing” contracts can achieve the Pareto improvement.

Analysis of Warehouse Value-Added Services Using Pareto as a Quality Tool: A Case Study of Third-Party Logistics Service Provider

The study aims to analyse warehouse value-added services (VAS) data for a third-party logistics (3PL) service provider, which leads to identifying service improvements and cost-cutting opportunities in performing VAS for clients using Pareto analysis as a quality tool. Using a case study approach, qualitative and quantitative data were collected from a leading 3PL firm in Belgium. The approach is conducted by applying major steps of Pareto analysis. Two pharmaceutical products were analysed according to medical general classification, namely narcotic analgesics (NA) and ophthalmic antihistamines and decongestants (OAD). The results showed that the Pareto principle is proven in the NA—ticketing case, and five activities consumed 83.3 percent of the total time of VAS operations. Furthermore, in the OAD—display case, the Pareto principle is proven and six activities were validated as they accounted for 81.26 percent of the total time of primary VAS operations. The study recommended a solution to each of the four causes of delay, including lack of training/best practices, inefficient space utilization, lack of automation, and lack of cohesiveness and planning. Despite the recognized importance of avoiding warehouse operation inefficiencies, the literature lacks studies applied to practice, and few contributions exist regarding analysing 3PL service providers’ warehousing VAS operations data. This study identified all VAS activities for temperature-controlled pharmaceutical products. Moreover, the study proposes a warehouse operations improvement framework for non-automated 3PL warehouses and guides managers through Pareto analysis to cut costs and improve service level.

Multiple allocation hub location with service level constraints for two shipment classes

In this paper, we study a hub network design problem arising in the context of a third-party logistics (3PL) service provider, which acts as an intermediary between shippers and carriers. A 3PL service provider usually caters to different classes of shipments that require different levels of service, e.g. two-day delivery, next-day delivery etc. We, therefore, study the problem under stochastic demand from two classes of shipments, with one class receiving priority over the other in service at the hubs to maintain the different service levels required by them. To this end, we present two models for designing a capacitated hub network with a service level constraint, defined using the distribution of time spent at hubs, for each shipment class. The models seek to design the hub network at the minimum total cost, which includes the total fixed cost of equipping open hubs with sufficient processing capacity and the variable transportation costs. The network of hubs, given their locations, is thus modeled as spatially distributed priority queues. The resulting model is challenging to solve, for which we propose a cutting plane-based exact solution method.

Optimal Preservation Effort and Carbon Emission Reduction Decision of Three-Level Cold Chain System with Low-Carbon Advertising Effect

To solve the problems of the impact of carbon emission reduction and low-carbon advertising on the supply chain of fresh agricultural products, a three-level low-carbon supply chain system composed of a manufacturer, a retailer and a third-party logistics service provider is taken as the research object. The profit functions of each party under the three contracts of the manufacturer bearing, the retailer bearing and the two parties jointly bearing the advertising cost are, respectively, established to solve the optimal pricing, advertising level preservation efforts, service levels and carbon emission reduction decisions. The numerical analysis shows that, with the increase in wholesale price and the decrease in fresh-keeping price coefficient and low-carbon cost coefficient, manufacturers will choose better fresh-keeping effort level and low-carbon service level. When the proportion of advertising cost borne by the supplier increases, the benefits of all parties in the supply chain will decrease; however, when the retailer bears the advertising cost alone, the profit of the supply chain system is the largest.

Blockchain and third-party logistics for global supply chain operations: Stakeholders’ perspectives and decision roadmap

In global supply chains, third-party logistics (3PL) services have proven to be critically important in helping many supply chain agents with distribution tasks so that they can focus on their core competencies of product development and manufacturing. However, there are many inadequacies in current global supply chains that affect the functions of 3PL. These shortcomings have necessitated digital transformation in many businesses. This digitalization enhances information sharing and supply chain visibility, which improves supply chain performance; however, it may create challenges regarding cybersecurity and data quality. Blockchain technology (BCT), with features such as being highly secure and distributed, can help. In this paper, we examine the literature and identify challenges associated with 3PL and how BCT can be used for 3PL. Then, we conduct interviews with four innovation/project managers of well-established logistics companies to uncover the status of BCT adoption in 3PL and the challenges that are hampering the adoption of this technology. Finally, we propose a framework together with a decision roadmap for BCT implementation.

Impacts of blockchain-based digital transition on cold supply chains with a third-party logistics service provider

Blockchain is a driver for digitalization in the fresh industry, but the resulting improvements in each supply chain member’s performance are difficult to predict. In this study, we examine the effects of blockchain-based digital transition in a cold supply chain with a manufacturer, a retailer, and a third-party logistics service provider (3PL). Our study provides several managerial implications. First, blockchain adoption would lead to a preservation service level increase if the 3PL charges a low transportation fee, but a preservation service level decrease if the 3PL charges a high one. Second, the blockchain adoption may induce the manufacturer to increase its wholesale price, which does not cause the retailer to cut the order quantity but instead sets a lager one. Third, our results indicate that simply relying on the market mechanism may not enable the cold supply chain to make the optimal decision; thus, government intervention or an exogenous coordination mechanism must be introduced to drive the cold supply chain members to reach a consensus on blockchain-based digital transition. Finally, the main results in the basic model are proven to remain robust. Managerial implications are discussed and provided.

Hub and Distribution Center Location for a Third-Party Logistics service Provider: A Case Study at Tehran

The rapid growth of the transportation industry and the advance of the e-commerce have opened opportunities for boom delivery services companies. Although, intense competition between shipping companies has obliged many to amend their shipment networks. In this setting, we aim to provide high-quality shipping services for a third-party logistics company in Iran. Currently, in the selected company, one hub is in the west part of Tehran that gives services to all customers. There are some difficulties in shipping services to the eastern part of Tehran city. Therefore, in this paper, we find the location of another hub center to streamline the shipping process. Moreover, to promote our service levels, some Distribution Centers (DCs) are going to be set up. Due to the lack of shipment data like pick up and delivery data, we tried to find the locations of the hub and the DCs based on Tehran population's data. We clustered 122 regions of Tehran based on population, economic index, accessibility to the internet, and the number of business units. Since some remote regions (which are not in the same vicinity) belong to the same cluster, we defined a relative distance criterion to avoid making remote regions in the same cluster. In each cluster, a fixed or movable DC can be set up to service the regions of its cluster. Moreover, to find the best candidate locations for the hub, each zone of Tehran was assessed based on some criteria like land cost, accessibility to the highways, and distance to its nearest bus terminal. Based on these criteria, some zones have been dominated by others, and the remains were considered as candidate locations in a hub location model. By considering the DCs as spokes in a hub and spoke model, the optimal location for the eastern hub establishment was determined.

Blockchain adoption decision analysis of fresh supply chain considering 3PL's misreporting behavior

In fresh supply chain, the third-party logistics service provider (3PL) has incentive to misreport its private information such as preservation service effort level and logistics transportation cost for the sake of gaining competitive advantage in the market. A tamper-proof and traceability system supported by blockchain technology (BCT) can prevent 3PL from misreporting. In this paper, we investigate the BCT adoption decision of a fresh supply chain consisting of a manufacturer, a retailer, and a 3PL when the 3PL misreports its private information. Specifically, we conduct four models: without BCT adoption and 3PL misreports its preservation service effort level (Model NE), without BCT adoption and 3PL misreports its logistics transportation cost (Model NC), without BCT adoption and 3PL misreports both preservation service effort level and logistics transportation cost (Model ND) and with BCT adoption and no misrepresentation (Model AB). By calculating the models, our study indicates that when the 3PL underreports its fresh-keeping service effort level and the degree of underreporting is high or when the 3PL overreports its logistics transportation cost and the degree of overreporting is high, all fresh supply chain members will reach an agreement on implementing BCT. However, when the 3PL misreports its fresh-keeping service effort and logistics transportation cost simultaneously, the BCT adoption decision is influenced not only by the misreporting coefficient of logistics transportation cost and preservation service effort, but also by logistics transportation cost. Finally, as logistics transportation cost increases, the manufacturer and retailer are reluctant to adopt BCT, while the 3PL is willing to adopt BCT.

Cloud Computing for Supply Chain Management and Warehouse Automation: A Case Study of Azure Cloud

In recent times, organizations are examining the art training situation to improve the operation efficiency and the cost of warehouse retail distribution and supply chain management. Microsoft Azure emerges as an expressive technology that leads optimization by giving infrastructure, software, and platform resolutions for the whole warehouse retail distribution and supply chain management. Using Microsoft Azure as a cloud computing tool in retail warehouse distribution and supply manacle management contributes to active and monetary benefits. At the same time, potential limitations and risks should be considered by the retail warehouse distribution and the supply chain administration investors. In this research summary of the cloud figuring tool, both public and hybrid in supply chain administration and retail, warehouse distribution is addressed. A brief introduction to the use of Microsoft Azure technology is provided. This is followed by the application of cloud computing to warehouse retail distribution and supply chain management activities. At the same time, the negative and positive aspects of familiarizing this Microsoft Azure technology in the modern supply chain and retail distribution are debated. Also, the circumstance for the third-party logistics services suppliers has indicated respect for automation and cybersecurity solutions in a cloud environment. Lastly, the upcoming research practices and following technological trends are offered as the conclusion.

Breaking truck dominance in supply chains: Proactive freight consolidation and modal split transport

Environmental concerns and a shortage of truck drivers motivate a paradigm shift in truck-dominated supply chains. To alleviate the pressure on truck transport, one can consolidate freight with other companies. Freight consolidation can be facilitated by third-party logistics service providers, who combine shipments that require delivery to the same destination on the same day. More gains can be realized through “proactive freight consolidation”, by proactively synchronizing the timing of shipments prior to placing orders. This is facilitated by a joint replenishment policy. The truck intensity of supply chains can be further reduced by shifting freight from road towards alternative transport modes, such as train. Modal split transport combines two complementary transport modes by using both modes in parallel. We analyze how proactive freight consolidation can be combined with modal split transport. We propose a heuristic that combines a can-order joint replenishment policy to consolidate freight orders proactively via truck, with a tailored base-surge policy to coordinate shipments via train. We develop a lower bound on the optimal cost to validate our heuristic. By comparing the truck usage and cost performance of our policy against alternative replenishment strategies, we show how the combination of proactive freight consolidation and modal split transport can shift freight towards alternative transport modes, without negatively impacting costs or service.

제3자 물류 서비스공급자의 역량을 통한 우간다 식품 가공업체의 물류 아웃소싱 성공에 대한 영향 분석

최근 급속한 세계화로 인해 물류 아웃소싱이 전 세계적으로 확대되고 있으며, 이것은 견고한 물류시스템을 구축하는 수단으로 간주되고 있다. 그러나 많은 기업이 물류 아웃소싱 계약에 어려움을 겪고 있어 기업의 내부 관리를 위해 물류 기능을 회복해야 하는 어려움이 계속되고 있다. 본 연구는 유연성, 통합, 혁신 및 기술 역량과 같은 물류 서비스 제공자(LSP)의 조직 역량이 우간다 식품 가공 회사의 물류 아웃소싱 성공에 어떤 영향을 미치는지 평가하는 것을 목표로 한다. 구조화된 설문조사를 이용하여 우간다 캄팔라에 있는 211개 식품 가공 회사에서 수집한 횡단면 데이터를 SmartPLS 3.3.7 소프트웨어를 통한 PLS-SEM(부분 최소제곱-구조방정식 모형화)으로 분석하여 이론적 관계를 검토하였다. 연구 결과에 따르면 기술 및 혁신 역량은 물류 아웃소싱 성공에 긍정적이고 상당한 영향을 미치지만, 유연성 및 통합 역량의 효과는 미미한 것으로 나타났다. 또한 중요도성과분석(IPMA) 결과 물류 아웃소싱 성공을 위해서는 기술 역량이 우선순위가 가장 높고 그다음이 혁신 역량인 것으로 나타났다. 그러나 유연성과 통합 역량은 우선순위가 낮았다.

К надежности выбора аутсорсинговой компании на рынке транспортно-логистических услуг

The article considers the reliability criteria when choosing a supplier of transport and logistics services. There has been conducted analysis of modern scientific literature by Russian and foreign authors, studied the statistical reports of transport and logistics companies. Two main problems in the activities of transport and logistics service providers are highlighted: the impact of transport and logistics outsourcing on vulnerability of the supply chain and the achievement of acceptable financial performance. It has been inferred that choosing the transport and logistics services supplier is a complex multi-criteria task including the use of both quantitative and qualitative criteria for decision-making. At the same time, when using different methods, the conclusions may contradict each other. Choosing the right third party logistics (3PL) provider logistics managers may not be sure that their choice will meet the needs of the company. Therefore, the decision to use a third-party logistics service provider depends on many factors that may vary from company to company, with the final choice depending on future goals, product lines, company plans, expansion, etc. Factors indicating success in choosing an outsourcing company include: cost reduction, maximum on-time delivery, minimum order lead time, increase in the number of alternative solutions, increase the efficiency of logistics activities, reduce logistics management costs, improve customer relationships and create mutually beneficial relationships in the supply chain. The criteria for selecting third-party transport and logistics companies are given (in descending order): price, reliability, location, timeliness of the order, cost reduction, management flexibility and innovation, quality of management, quality of service, personalized service, reputation of the supplier, technical competence, good communication, variety of services available.

The Evaluation of Third-party Logistics Services Using Complex Proportional Assessment

The Evaluation of Third-party Logistics Services Using Complex Proportional Assessment

A strategic decision-making framework for sustainable reverse operations

Several factors, such as rapid industrial development, rising population, growing waste disposal, and exponential depletion of natural resources, have become a global challenge and call for a multifaceted approach to environmental protection. Rising consumers' awareness of environmental issues and the evolving ecological legislation puts pressure on businesses to adopt green practices in product design, manufacturing, distribution, and end-of-life disposition. Looking at these challenges, reverse logistics (RL) also known as reverse operations has become the most investigated theme in Supply Chain Management (SCM). Incorporating reverse logistics into the supply chain is not a simple task. Outsourcing reverse operations to the third-party reverse logistics service provider (3PRLSP) is an important strategic decision by many companies. This helps them to achieve a competitive advantage by reducing costs and improving quality processes and services. To this aim, this paper proposes a novel hybrid framework for selecting a 3PRLSP for the electronic industry. The first stage includes the preliminary screening of 3PRLSPs based on the method of effectiveness and compliance (E&C). In the second phase, graph theory and matrix approach (GTMA) is employed to choose the best 3PRLSP for outsourcing the reverse operations. The application of the proposed method is validated through a case-study based approach with reference to the Indian consumer electronic company. The data for the study was collected from experienced experts in senior managerial positions in the industry. The study findings revealed that the three dimensions of sustainability- economic, environmental and social, are vital in selecting 3PRLSP.

Selection of Third-Party Reverse Logistics Service Provider Based on Intuitionistic Fuzzy Multi-Criteria Decision Making

The scientific selection of a third-party reverse logistics service provider (3PRLP) is helpful for enterprises to obtain the expected ecological and economic benefits. Different enterprises have different requirements for 3PRLP selection and, thus, should adopt personalized and simplified evaluation criteria. However, there is a lack of research on criteria screening. Therefore, this paper proposes a criteria screening method based on a rough set for the first time. The 3PRLP selection is a multi-criteria decision making (MCDM) problem in essence, and different criteria can be expressed in different forms. The existing research mostly uses one method for 3PRLP selection, lacking the comprehensive application of various methods. In this paper, various criteria values are transformed into intuitionistic fuzzy numbers (IFNs) for the comparison and combination of various intuitionistic fuzzy MCDM methods. In terms of criteria weighting, a subjective weighting method based on an analytical network process (ANP) is proposed due to the possible correlation between the criteria at the same level. Meanwhile, an objective weighting method based on intuitionistic fuzzy entropy is proposed. The subjective and objective weights are integrated to form the more scientific combination weights. Combining the modeling principles of different intuitionistic fuzzy MCDM methods, the representative methods under each principle are chosen to build a combination evaluation idea that integrates multiple single evaluation models, and the specific evaluation steps are given, including the single evaluation, Kendall compatibility test, combination evaluation, and Spearman consistency test. An illustrative example of 3PRLP selection is provided to verify the feasibility of the methods of criteria screening and weighting and the combination evaluation idea.

An Industrial Blockchain-Based Multi-Criteria Decision Framework for Global Freight Management in Agricultural Supply Chains

In view of increasing supply chain disruption events, for example the China–United States trade war, the COVID-19 pandemic, and the Russia–Ukraine war, the complexity and dynamicity of global freight management keeps increasing. To build a resilient and sustainable supply chain, industrial practitioners are eager to systematically revamp the freight management decision process related to the selection of carriers, shipping lanes, and third-party logistics service providers. Therefore, this study aims at strengthening decision-making capabilities for global freight management, in which an industrial blockchain-based global freight decision framework (IB-GFDF) is proposed to incorporate consortium blockchain technology with the Bayesian best-worst method. Through the blockchain technology, pairwise comparisons can be conducted over the international freight network in a decentralized and immutable manner, and thus, a secure and commonly agreed-on pairwise comparison dataset is acquired. Subsequently, the pairwise comparison dataset with multi-stakeholder opinions is analyzed using the Bayesian best-worst method in order to prioritize the selection decision criteria related to carriers, shipping lanes, and 3PL service providers for global freight management. To verify the methodological feasibility, a case study of an Australian agricultural supply chain firm was conducted to support the development end-to-end (E2E) supply chain solutions originated from Australia. It was found that port infrastructure, ports of call and communication effectiveness were the major criteria for the selection decision, which can be emphasized in future global freight collaboration. In addition, an immutable and append-only record of pairwise comparisons can be established to support the visibility of time-varying stakeholders’ preferences.