Logistics outsourcing practices in the UK: a survey

Outsourcing is widely regarded as a useful approach to lowering costs and gaining competitive advantage. Logistics and transportation were among the most popular areas that used outsourcing during the 1980s and 1990s. Thus, the strategy of employing the third-party logistics (TPL) providers' services has attracted growing interest. However, studies that involve TPL providers have received considerably less academic attention. This paper presents current logistics outsourcing practices of UK firms as well as the trends from 1990 to 2003 based on a series of surveys by PE Consulting. The study is based on a mail survey of 224 logistics managers from various industries in the UK. It also provides insights into the reasons why some firms do not use the TPL services. Among the key findings, a change was found in the customers' main concern about outsourcing their logistics functions from service to cost-related factors. The study displays the trend towards the development of longer term partnerships, and relatively little change in the levels of satisfaction is exhibited.