Transportation Outsourcing: A Survey of US Practices

Abstract

The majority of the companies surveyed are outsourcing some transportation functions. The most frequently outsourced transportation functions are freight bill auditing, freight payment and transportation reports, which are basically clerical/repetitive in nature. Also, frequently outsourced are international shipping and fleet maintenance, functions that require considerable technical expertise and assets. Transportation functions of a strategic nature are usually not outsourced. The primary reasons for outsourcing are labour cost savings, specialisation, asset reduction, and expanding workload. Generally, the firms that outsourced transportation are satisfied with the service. Loss of management control is the most important reason for not outsourcing, although loss of control was not identified as a major problem area for firms who do outsource. The providers of transportation outsourcing services are relatively small corporations.