Impact of Logistics Outsourcing Strategy in Oil and Gas Industry in Uganda

Abstract

The purpose of the study is to analyze the impact of logistics outsourcing strategy in the oil and gas industry inUganda. The most outstanding benefit is that, companies outsourced their logistics activities to restructure theirdistribution networks and achieve competitive advantage. For this purpose purposive sampling method is usedwhere qualitative data are collected and interpreted. Primary data are collected using research questionnaireswhere quantitative method is used in data presentation and analysis of the impact of logistics outsourcingstrategy in the oil and gas industry. The research findings reveal that there are many benefits resulting fromusing logistics outsourcing strategy in the oil and gas industry and in the same way, challenges are faced by bothoil and gas companies and logistics service providers in executing business contracts. Solutions are pursued tocreate an environment for the oil and gas industry and the third party logistics services providers to achieve acommon goal. Findings show that it is very important to outsource full or part of logistics activities to logisticsservice providers in order to attain competitive advantage. Logistics outsourcing strategy plays an important rolein the business especially in minimizing operating costs and spreading risk between the parties engaged inbusiness contracts. Therefore it is necessary for company managers to check their strategies to make sure thatlogistics activities are in place.

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