The a customer and the 3PL as service provider.

The aim of this
study is to identify the importance of the role played by the 3PL and
investigate on the main KPIs that should be taken in the consideration to build
a long term trust relationship between the company as a customer and the 3PL as
service provider.

By the same
token, I will also define the evolution of the status of the third party
logistics (3PL) in France, and particularly in the luxury sector. The finding
of this research are based on previous similar studies and relevant papers.

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However, this study is limited as described as follow.

 

1.    Background

 

1.1  The high importance of supply chain
management and logistics nowadays

 

Over the Last
two decades, the role and the importance of the logistics and supply chain has
increased significantly where the general conditions of doing business over
that period have also changed drastically. The main considerable reasons of
that change that belongs to the increasing demanding market and consumers, the
increase of the competitiveness of the market, the introduction of the new
technologies and the globalisation. (Rushton & walker, 2007).

In order to cope
up with the changing market, the companies seek new ways to adapt where the
main affected area is the logistics and the supply chain department.

These two
services (either done internally or outsourced) are the pillar of the process
improvement, increase of the competitiveness by the cost reduction and the
amelioration the customer value.

 

2.2The increasing role of the
third-party logistics

 

The significant
growth of the business dynamics nowadays has made the outsourcing of the
logistics functions very common and widespread all over the world. Numerous are
the logistics services and functions that can be outsourced in order to
facilitate the process efficiently and effectively internally and many are the
reasons behind this process of subcontracting. (Sahay &
Mohan, 2006)

The overall activities
that can be considered in outsourcing can be resumed as follow:

·     
Servicing the in-house transformations /
Acquisitions: for example: trucks, warehouses and other premises owned by the
outsourcing company.

·     
Managing all the processes related to the purchasing
of the raw materials, till the delivery to the final customer and the after
sales services

·     
Setting up a new logistics firm or acquiring a
logistics subsidiary

 

Nowadays, the perception
of the outsourcing concept has become enormous and the main outsourced
activities are warehousing, transportation, purchasing. (Rushton &
walker, 2007)

 

As reported in
the survey of Lieb and Bentx (2005), approximately about 80 percent of the
Fortune 500 companies work with a 3PL while their internal operating budget,
allocated to the 3PL providers, is significantly increasing.

 

There are multiple
factors for companies that influence their internal strategy and lead them to
outsourcing their logistics functions and these factors can be summarized as
follow (Göl & Bülent , 2007) (Aktas & Ulengin, 2005) (Semchi-Levi,
Kaminsky, & Simchi-Levi, 2008):

·     
Building a significantly bigger competitive
advantage

·     
Decreasing the costs and the in-house
investments

·     
Focus on the core activities of the company

·     
Increasing the service level and the customer
satisfaction

·     
Moving ahead with the globalization

·     
Rising the speed to market

·     
Promote the innovation

·     
Increasing the revenues and the profitability of
the company

·     
Decreasing the personnel

·     
Ameliorating the Supply Chain Management of the
company

 

Furthermore, the
3PL services have meaningful contributed in the development of the Macro
Economy. After the second half 1990s, (Gordon, 2008)the 3PL concept has grown by more than
20 percent per year. However, the 3PL sector has an immense potential evolution
in the US in particular (with 10% of the total annual logistics costs allocated
to the 3PL) and worldwide in general.

 

2.    Definition of the problem

 

The logistics
services in the luxury field play a huge and important role in the process of
maintaining a good image of the brand, the quality of the product delivery
(with the appropriate delivery) and mainly maintain the competitive advantage
among the other competitors. Therefore, the expectations from the 3PL industry
are mainly based on the role it plays in development of the company as the
country’s global economy.

Nonetheless,
there has been some studies conducted about 3PL and its importance in Europe but
in the world as a whole. Notwithstanding, no study has mainly focused on the
nature and importance of the logistics services deployed by luxury sector in
France.

 

In
the last decennary, many questionnaires and survey-based studies have been
published as academic sources in order to evaluate the importance and degree of
collaboration with 3PL across different countries. These analyses have been
conducted first in North America (LIEB & RANDALL, 1996), Europe (C. Lieb, A.

Millen, & Van Wassenhove, 1993) (Wilding &
Juriado, 2004),
Australia (Dapiran, Lieb, Millen, &
Sohal, 1996) (Sohal,
Millen, & Moss, 2002), Malaysia (Sohail &
Sohal, 2003),
India (Sahay & Mohan, 2006), Saudi Arabia (Sohail &
Al-Abdali, 2005).

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