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Choosing the right sourcing model for thirdparty logistics outsourcing agreements

Author

Listed:
  • Vitasek, Kate

    (University of Tennessee, USA)

  • Downard, Andrew

    (Collaborative Impact Advisory, Australia)

Abstract

Modern outsourcing is more than a typical make–buy decision. Rather, there is a wide range of sourcing business models that today’s practitioners can choose from. Unfortunately, the fundamental nature of how goods and services are procured is not keeping pace with best practices of tapping into more mature sourcing business models; many business professionals wrongly assume that a transaction-based business model is the only way to architect a supplier contract. This paper provides an easy-to-understand framework for classifying the various contracting approaches along a sourcing continuum. A key goal of the paper is to help organisations understand the various models and see examples of how they are used in practice.

Suggested Citation

  • Vitasek, Kate & Downard, Andrew, 2024. "Choosing the right sourcing model for thirdparty logistics outsourcing agreements," Journal of Supply Chain Management, Logistics and Procurement, Henry Stewart Publications, vol. 7(1), pages 47-58, September.
    • Handle: RePEc:aza:jscm00:y:2024:v:7:i:1:p:47-58
    as

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    More about this item

    Keywords

    sourcing; sourcing business models; logistics service provider (LSP); third-party logistics (3PL); supply chain management (SCM); outsourcing; Vested outsourcing; performance-based contracts;
    All these keywords.

    JEL classification:

    • L23 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Organization of Production
    • M11 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Production Management

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