Managing dependence in logistics outsourcing relationships: evidence from China

Abstract

As third-party logistics (3PL) plays an increasingly important role in businesses, managing dependences between 3PL providers and users has become critical for business success. Drawing on the resource dependency theory (RDT), we propose that logistics integration and interorganisational relationships are two effective approaches for 3PL users to cope with their dependence on 3PL providers and to achieve better financial performance. The model was empirically tested using data collected from 134 3PL users in China. The results show that both inter-organisational relationships and integration and their interplay effectively carry the positive influence of dependence on financial performance. We also find that while both interorganisational relationships and integration are effective for Chinese-controlled 3PL users to leverage their dependence on 3PL providers for financial performance improvement, foreign-controlled 3PL users rely solely on interorganisational relationships to manage their dependence.

Keywords:

• dependence
• relationship quality
• logistics integration
• third-party logistics (3PL)
• ownership
• China

Acknowledgement

We I gratefully acknowledge the support of the major program funding from the National Natural Science Foundation of China (Project numbers 71090403/71090400), the Natural Science Foundation for the Youth Scholars of Anhui Province (1208085QG137), and the New Century Excellent Talents in University (NCET-09-0301), China.

Notes

We gratefully acknowledge the support of major program funding from the National Natural Science Foundation of China (project numbers 71090403/71090400).