Cooperation between two logistics service providers with different distribution ranges

This paper focuses on the cooperation between two logistics service providers (LSPs) with different distribution ranges. Taking a business express (BE) and a state‐owned LSP, i.e., China Post (CP) as examples, the cooperation situation between them and the non‐cooperation situation are considered separately, and the two resulting profits are compared with each other. The results show that: 1) there is a complementation between the service advantages of BEs and the delivery range advantages of CP; 2) the proposed way of cooperation is conditionally able to save more manpower costs and increase profits; 3) the incremental profit has positive correlation with the demand from remote areas. Finally, a feasible consignment contract is also provided.