Examining success factors for logistics outsourcing in Sub-Saharan Africa

Abstract

With the rapid globalization of business activities, logistics has become incredibly complex and intricate. As such, managing logistics is more challenging than ever. One of the trendy solutions to deal with this challenge is logistics outsourcing. In this regard, Sub-Saharan African firms are no exception. To help Sub-Saharan African firms succeed in leveraging logistics outsourcing for their competitive differentiators, this article aims to investigate how the organizational capabilities of third-party logistics service providers (3PLs) contribute to their users' logistics outsourcing success. Based on an empirical analysis of 211 food processing firms in Uganda, we found that the 3PLs' technological and innovation capabilities positively affected logistics outsourcing success. In contrast, the 3PLs' flexibility and integration capabilities had no bearing on the logistics outsourcing success. In particular, our importance–performance map analysis (IPMA) revealed that the 3PLs' technological capability was the most significant factor in logistics outsourcing success. The article also expounds on how the 3PLs' technical capability can bring logistics outsourcing success.