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Third-party purchase: An empirical study of third-party logistics providers in China

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  • Shi, Yangyan
  • Zhang, Abraham
  • Arthanari, Tiru
  • Liu, Yanping
  • Cheng, T.C.E.

Abstract

Third-party purchase (3PP) is an emerging value-added service offered by third-party logistics (3PL) providers. In this paper we first present a real-life 3PP service model to illustrate 3PP’s innovative aspect. We then develop a conceptual model grounded in multiple theories to probe the value propositions of 3PP. We apply structural equation modeling to test the conceptual model based on the survey data from 245 Chinese 3PL providers. We find that, from the perspective of 3PL providers, uncertainty, order frequency, and transaction size, but not asset specificity, are significantly associated with 3PP service, which in turn is significantly associated with value-to-client and benefit-to-3PL provider. Existing studies have focused on investigating the basic services offered by 3PL providers using transaction cost analysis. This study provides evidence that 3PP is a new value-added service that will generate mutual benefits for both 3PL providers and users.

Suggested Citation

  • Shi, Yangyan & Zhang, Abraham & Arthanari, Tiru & Liu, Yanping & Cheng, T.C.E., 2016. "Third-party purchase: An empirical study of third-party logistics providers in China," International Journal of Production Economics, Elsevier, vol. 171(P2), pages 189-200.
    • Handle: RePEc:eee:proeco:v:171:y:2016:i:p2:p:189-200
    DOI: 10.1016/j.ijpe.2015.08.028
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    Cited by:

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    7. Raut, Rakesh D. & Gardas, Bhaskar B. & Narwane, Vaibhav S. & Narkhede, Balkrishna E., 2019. "Improvement in the food losses in fruits and vegetable supply chain - a perspective of cold third-party logistics approach," Operations Research Perspectives, Elsevier, vol. 6(C).
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    9. Mohammad Tamannaei & Hamid Zarei & Sajede Aminzadegan, 2021. "A Game-Theoretic Approach to the Freight Transportation Pricing Problem in the Presence of Intermodal Service Providers in a Competitive Market," Networks and Spatial Economics, Springer, vol. 21(1), pages 123-173, March.
    10. Zhu, Wenwen & Ng, Stephen C.H. & Wang, Zhiqiang & Zhao, Xiande, 2017. "The role of outsourcing management process in improving the effectiveness of logistics outsourcing," International Journal of Production Economics, Elsevier, vol. 188(C), pages 29-40.
    11. Yuan, Yang & Chu, Zhaofang & Lai, Fujun & Wu, Hao, 2020. "The impact of transaction attributes on logistics outsourcing success: A moderated mediation model," International Journal of Production Economics, Elsevier, vol. 219(C), pages 54-65.
    12. Liu, Weihua & Zhang, Jiahui & Shi, Yangyan & Lee, Paul Tae-Woo & Liang, Yanjie, 2022. "Intelligent logistics transformation problems in efficient commodity distribution," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 163(C).
    13. Huo, Baofeng & Ye, Yuxiao & Zhao, Xiande & Wei, Jiang & Hua, Zhongsheng, 2018. "Environmental uncertainty, specific assets, and opportunism in 3PL relationships: A transaction cost economics perspective," International Journal of Production Economics, Elsevier, vol. 203(C), pages 154-163.
    14. Lam, Hugo K.S. & Zhan, Yuanzhu & Zhang, Minhao & Wang, Yichuan & Lyons, Andrew, 2019. "The effect of supply chain finance initiatives on the market value of service providers," International Journal of Production Economics, Elsevier, vol. 216(C), pages 227-238.
    15. Peng Jiang & Yi-Chung Hu & Ghi-Feng Yen, 2017. "Applying Grey Relational Analysis to Find Interactions between Manufacturing and Logistics Industries in Taiwan," Advances in Management and Applied Economics, SCIENPRESS Ltd, vol. 7(3), pages 1-2.
    16. Yu Gong & Lujie Chen & Fu Jia & Richard Wilding, 2019. "Logistics Innovation in China: The Lens of Chinese Daoism," Sustainability, MDPI, vol. 11(2), pages 1-21, January.
    17. Wang, Qianwen & Liu, Xu & Huo, Baofeng & Zhao, Xiande, 2023. "Economic or relational first? Establishing the competitiveness of third-party logistics information sharing by devoting specific assets and mutual trust," International Journal of Production Economics, Elsevier, vol. 261(C).

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