Nikam

diary of Management and Marketing Research

Success factors and cost focus strategies for logistics
outsourcing
George N. Kenyon
Lamar University
Mary J. Meixell
Quinnipiac University
Abstract
Logistics outsourcing has a significant effect on how manufacturing wholes spring up and
deliver products to their customers. Indeed, many manufacturing firms do not own or manage the
transportation and warehousing resources used for inbound and outgoing shipments from their
facilities. Earlier research, however, has cast doubt on the efficacy of outsourcing, as some
companies experience favorable executing outcomes while others do not. This research
investigates the cause of logistics outsourcing on cost by analyzing empirical data across a wide
variety of industries, using data from a check up on of manufacturing plant managers. Our analysis
indicates that outsourcing logistics activities slightly increased COGS, but the existence of
lead factors suggests interesting new strategies for outsourcing the logistics functions.




Keywords: Logistics, Outsourcing, Manufacturing Strategy, Empirical analysis

Success factors for outsourcing, Page 1

Journal of Management and Marketing Research
INTRODUCTION
The efficiency and effectiveness of the logistics operation has a considerable influence
not only on the business performance of manufacturers but also on the customers intuition of
the quality of the products and services provided by the plant. If inbound material flows from the
supplier are erratic, the firms internal operation leave behind not be able to sustain their production
strategies without a heights level of safety stock. Similarly, if the flows of finished goods to the
customer are unreliable, the firms customer base will be dissatisfied. Accordingly, logistics is
strategically important in many industries as it is central to achieving warring advantage
(Bowersox, Closs, & Cooper, 2010).
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