Ruth Banomyong

Department of International Business, Logistics and Transport, Faculty of

Commerce and Accountancy, Thammasat University, Bangkok, Thailand, and

Nucharee Supatn

Martin de Tours School of Management, Assumption University, Bangkok,

Thailand

European Journal of Marketing

Vol. 45 No. 3, 2011

pp. 419-437

Emerald Group Publishing Limited

0309-0566

DOI 10.1108/03090561111107258

Submitted to : DR. Saad Mesbah

Submitted by : Mahmoud Mohamed Sayed Ahmed

Content

Abstract

Introduction

Literature Review

Objective

Data collection

Methods of data analysis

Results

Conclusions

References

Abstract

Purpose

The purpose of this research is to identify key

attributes of freight logistics service quality

and to examine how these attributes impact

shippers’ selection of third-party logistics service

providers (3PLs). The knowledge and

understanding of these attributes can be of great

value to 3PLs

when developing marketing strategies to attract

and retain clients.

Introduction

Globalization has emerged as a major force shaping

business strategies during the last two decades which has

led to an increase in export trade for many developing

countries especially for Asian countries such as Singapore,

Malaysia and Thailand.

Logistics activities especially freight logistics play a

significant role in supporting export activities. Efficient

logistics management is considered a powerful source of

competitive differentiation since it is not only a source of

cost savings .

Literature Review

Conway and Whitelock (2007) also stated that

strategic marketing strategy should focus on continuous and long-term

relationship

between customers and service providers.

D’Este (1992) developed a behavioural

framework to represent the various stages in the decision-making process and

the

interaction of factors that influenced shipping managers when selecting

carriers in the

Ro/Ro ferry trade between Melbourne and Tasmania.

Palmer et al. (2005) suggested that

traditional marketing strategies such as pricing and sales promotional strategy

may

not be adequate for this era. Goh and Pinaikul (1998) observed that Thai

shippers

usually selected their 3PLs based on word-of-mouth recommendation and

long-term

relationships rather than on marketing. Conway and Whitelock (2007) also

stated that

Objective

The selection of logistics service

providers

Bottani and Rizzi (2006) suggested that

there are five main steps involved in the

selection of logistics services:

(1) the identification of the need to

outsource logistics;

(2) the development of feasible alternatives

by comparing the use of internal

expertise, knowledge, experience to hiring

outside expert and obtain

professional logistics service;

(3) the evaluation of candidates and

selection

of a service provider;

(4) the implementation of services; and

(5) the service evaluation to control the

performance, to select a new service

provider or to enhance the relationship

between the firm and the logistics

service provider.

Logistics service quality

service quality can be categorised into five

dimensions:

(1) Tangibility which refers to the

appearance of physical facilities, equipment,

personnel, and communication materials.

(2) Reliability which is the ability of a service

provider to perform the promised

service dependably and accurately.

(3) Responsiveness which is the willingness

to help customers and provide prompt

service.

(4) Assurance refers to the knowledge and

courtesy of service providers and their

ability to convey trust and confidence.

(5) Empathy means caring and

individualised attention that the service

provider

provides to each customer.

Data collection

In order to determine which freight logistics service

attributes were important and to

examine the impact of these attributes on 3PL

selection, a survey was conducted, and interviews

A questionnaire was developed based on the

literature and the in-depth interviews results.

A logistic regression analysis was used to examine

the relationships between all service attributes and

shippers’ decision-making process in selecting a

given.

Methods of data analysis

To ensure that all proposed service attributes were

usable, three statistical analyses i.e.

Cronbach’s alpha coefficient, item-to-total analyses

and exploratory factor analyses

was performed. These analyses were performed to

assess reliability and validity of the

data and measurement items. All scale items were

refined based on the generally

accepted guidelines provided by Hair et al. (2006).

Results

A total of 24 freight logistics service attributes were

identified and categorized based on the SERVQUAL

model into six dimensions: reliability, assurance,

tangibility, empathy, responsiveness, and cost. Freight

logistics service quality was found to impact shippers’

selection of 3PLs significantly.

exploratory factor analysis for service quality indicated

that most service attributes could determine each

dimension of freight logistics service quality while 76.42

percent of the overall freight logistics service quality

could be explained. However, some low

Conclusions

Conclusions and research implications

The major contribution of this study is related to the understanding of the

freight logistics service quality concept.

Unlike most previous studies that focused on generic logistic service

quality, service attributes that are specific to freight logistics were

identified in this research.

Freight logistics key service quality attributes were initially obtained from

the literature and modified based on the interview data gathered from

shippers and logistics service providers.

The impact of freight logistics service quality on 3PL selection was

analysed.

The focused on the individual service attributes. The results indicated

that reliability, assurance and the service cost dimension were

significantly related to the shippers’

Keywords

Freight forwarding

Decision making

Thailand

References

Banomyong, R. (2007), “Thailand logistics costs/GDP”, Thammasat

Logistics Research Papers,Vol. 3 No. 1, pp. 1-2.

Bloemer, J., Ruyetr, K. and Wetzels, M. (1999), “Linking perceived

service quality and service loyalty: a multidimensional perspective”,

European Journal of Marketing, Vol. 33 Nos 11/12,pp. 1082-106.

TIFFA (2004), Thailand Freight Forwarding Handbook 2004, Cosmic

Publications, Bangkok. Van Laarhoven, P., Berglund, M. and Peters, M.

(2000), “Third-party logistics in Europe – five years later”, International

Journal of Physical Distribution & Logistics Management, Vol. 30 No. 5,

pp. 425-42.

Nunnally, J.C. (1978), Psychometric Theory, 2nd ed., McGraw-Hill, New

York, NY.