Logistics Service Providers in Internet Supply Chains

Abstract

Logistics services and their providers are helping intermediaries add value to Internet supply chains in ways that are not always immediately obvious. Thus, it is not surprising that there is confusion among academics and practitioners about how best to extract value from such services and providers. A new study provides a framework that reveals details about the role and value of logistics services and their providers and explains why it is important to capture that value. Moreover, the study shows that Internet sellers establish relationships with logistics service providers in order to extract value from the providers' network of logistical resources and better fulfill their customers' orders. The study suggests that Internet sellers form these relationships to lower the costs they would incur if they were organized to carry out the logistics services internally. Additionally, Internet sellers seek these providers in order to access strong networks that bundle many complementary logistics services and make these services available across new and existing relationships between the Internet sellers, their customers, and their vendors.

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