Third‐party logistics provider customer orientation and customer firm logistics improvement in China

Abstract

Purpose

Based on customer value theory, this paper aims to propose and test a conceptual model of the relationship between third‐party logistics (3PL) provider customer orientation and customer firm logistics improvement.

Design/methodology/approach

The 3PL provider customer orientation is conceptualized as a higher, second‐order construct made up of four key logistics‐driven first‐order indicators: service variety, information availability, timeliness, and continuous improvement. A survey‐based approach is utilized to collect data from managers at 124 manufacturing customer firms in the People's Republic of China; structural equation modeling is performed to assess measures and test the hypothesized relationships.

Findings

Chinese 3PL provider customer orientation significantly influences customer firm logistics improvement.

Research limitations/implications

Findings are based on single source perceptual data from customer firm key respondents. Tests indicate that common method bias is not a problem.

Practical implications

At a time when market pressure is compelling Mainland Chinese 3PL providers to upgrade and expand service offerings, 3PLs with a strong customer orientation create significant value for customers through superior execution on key elements of logistics service.

Originality/value

The paper responds to calls for additional theoretically driven assessment of market orientation in logistics service provider firms by identifying explicit behavioral manifestations of 3PL customer orientation that enhance customer firm logistics performance.

Citation

Tian, Y., Ellinger, A.E. and Chen, H. (2010), "Third‐party logistics provider customer orientation and customer firm logistics improvement in China", International Journal of Physical Distribution & Logistics Management, Vol. 40 No. 5, pp. 356-376. https://doi.org/10.1108/09600031011052822