Article
Logistics Capability, Logistics Outsourcing and Firm Performance In an E-commerce Market
Purpose – Effective and efficient supply chain management is critical to the success of firms
engaging in e-commerce. The purpose of this paper is to examine the impact of logistics capability and
logistics outsourcing on firm performance in an e-commerce market environment.
Design/methodology/approach – This research examines the relationship between firm’s logistics
capability, logistics outsourcing and its performance. Multiple-item constructs are used to measure the
strength of logistics capability and firm performance. The use of logistics outsourcing is represented
by a dichotomous variable. Data obtained via a survey were analyzed to investigate relationships
among constructs and various hypotheses were tested.
Findings – Study results revealed logistics capability to be positively related to firm
performance in the e-commerce market. However, counter-intuitively, logistics outsourcing and
firm performance were not found to be positively linked. Further, the association between
logistics capability and outsourcing was not supported. Finally, the interactive effect of logistics
outsourcing on the relationship between logistics capability and firm performance was not
sustained.
Research limitations/implications – Research findings are constrained, as the study was
limited to the computer and consumer electronics retailing industry. However, the importance of
logistics capability was confirmed in the e-commerce supply chain for this segment. And
the benefit of using third-party logistics (3PL) to enhance firm performance was not fully
established.
Practical implications – Logistics capability is critical for superior firm performance in
e-commerce. However, study findings lead to the presumption that firms should avoid logistics
outsourcing if performance is predicated on competitive advantage due to internally strong logistics
capability and competencies.
Originality/value – This research contributes to the study of logistics capability and 3PL in
e-commerce. The development of a logistics capability measurement construct in e-commerce
originated with this research. Also the impact of logistics outsourcing on firm performance is tested for
the first time in an e-commerce market environment.