Examining the links between logistics outsourcing, company competitiveness and selected performances: the evidence from an emerging country

Abstract

PurposeThis study examines the mediation effects of time-based competitiveness, cost-based competitiveness and customer performance between logistics outsourcing and financial performance.Design/methodology/approachThe study relied on a questionnaire as the primary data collection instrument and further employed partial least squares structural equation modelling technique to test all formulated hypotheses.FindingsThe results demonstrate that logistics outsourcing has a significant positive impact on time-based competitiveness, cost-based competitiveness, customer performance and financial performance. Time-based competitiveness and cost-based competitiveness were both found to have a significant positive impact on financial performance; however, customer performance had no significant impact on financial performance. The mediation analysis further indicates that while both time-based competitiveness and cost-based competitiveness play mediation effects between logistics outsourcing and financial performance, customer performance plays no mediation effect between logistics outsourcing and financial performance.Research limitations/implicationsThe sampled firms for this study came from a single emerging country; hence, the results cannot be generalized or imported to reflect the results that may be obtained from other emerging geographical settings.Practical implicationsThe results provide sufficient evidence for managers to turn their attention to logistics outsourcing, as a transformative business initiative, to gain time-based and cost-based competitiveness so as to improve financial performance.Originality/valueThe study provides significant insight and makes an additional contribution to literature in the area of logistics outsourcing, especially by collecting data from an emerging country. Modelling time-based competitiveness, cost-based competitiveness and customer performance as mediating variables between logistics outsourcing and financial performance make this work relatively different from other studies.