Abstract:
The Asia Pacific region is the world's largest Third-party logistics (3PL) market and
the fastest-growing. Sri Lanka is placed 94th out of 160 countries in the World Bank's
Logistics Performance Indicator (LPI) for 2018, indicating a need to enhance the
quality of its logistics services. One aspect that might help to improve the quality of
logistics services is the performance of 3PL service providers. The paucity of studies
in this area has magnified the need for more studies. Accordingly, the key objective
here is to figure out the main drivers for customer satisfaction in 3PL market in Sri
Lanka. The study used the systematic literature review and expert opinions to
identify the drivers for 3PL market in Sri Lanka. Quantitative methodology was
applied, where 130 registered logistics companies in Sri Lanka were chosen as the
sample using the purposive sampling technique. A structured questionnaire was
used to collect data, and data were analyzed using factor analysis. Accordingly, seven
factors (service quality, mutual trust, IT capability, flexibility, service recovery,
reputation of 3PL providers, and information sharing) have been explored, which
can explain about 61% of the variance among indicators. Further, Pearson
correlation and linear regression analysis were used to analyze the data by SPSS.
Results indicate that the reputation of 3PL providers, information sharing, and
service quality are the significant drivers on 3PL market, whereas IT capability,
service recovery, and flexibility are insignificant drivers. It is commonly accepted
that local firms may improve their international competitiveness by utilizing
logistics to create value, and findings of this study would be beneficial for such an
objective.
