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An Effect of Concreteness and Fairness of Service Contract on Performance of Service Provider in Logistics Outsourcing  

Kim, Jin-Su (인천대학교 동북아 불류대학원, 유니코로지스틱스(주))
Song, Sang-Hwa (인천대학교 동북아 불류대학원)
Publication Information
Journal of Korea Port Economic Association / v.28, no.2, 2012 , pp. 129-153 More about this Journal
Abstract
Even though logistics service outsourcing becomes widespread in manufacturing and service industries, logistics service providers encounter fierce competition and lower profit. Decreased profit has negative impact on service providers' competitiveness, which in turn threats successful relationship with shippers. In this paper, we investigate the factors which influence the performance of service providers. Factors related to service contract are examined and we test an effect of concreteness and fairness of service contract. PLS (Partial Least Square) modeling method is applied and validated using data from logistics service providing companies in Korea. In the model, service contract clauses are classified into two categories including cost and risk sharing terms. PLS analysis shows that partnership and performance of service relationship is improved when contract clauses are specified in detail. This study will contribute in providing an operational direction in effectively establishing a positive relationship between the logistics service provider and the shipper.
Keywords
Logistics Contract; Logistics Outsourcing; Partnership; Logistics Performance; Fairness;
Citations & Related Records
Times Cited By KSCI : 1  (Citation Analysis)
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