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Factors in uencing the decision to outsource logistics services

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This study examines the factors in uencing the decision to outsource logistics services of
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analysis, con rmatory factor analysis, and structural equation modeling were employed to
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characteristics of service providers have the most signi cant impact on these enterprises’
decisions to outsource logistics services. Moreover, outsourcing strategy also a ects logistics
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improve operational e ciency, reduce logistics costs, save time, and increase business pro ts. In
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logistics services has become a popular trend in enterprises to optimize resources e ciency
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Many studies have examined the factors a ecting the decision to outsource the logistics
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outsourced services, a ecting the decision to choose logistics service providers for enterprises
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conducted to determine the factors in uencing the decision to outsource logistics services of
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analytical techniques. From the research ndings, the study proposed recommendations for
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The rst section of this study introduces the background information and highlights the
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a model of factors a ecting the outsourcing of logistics services of SMEs in Vietnam. The
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Service outsourcing is when a rm hires a provider to do the work the business needs to do
LQVWHDG RI GRLQJ LW RQJ HW DO , 2007). Outsourcing is one of the important decisions a ecting
the development of a rm (Gewald and Dibbern, 2009). Outsourcing services have many
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and e ectively managing their resources to focus on developing their core competencies
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rms outsource services. This theory was developed by Coase (1937) and assumes that rms
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words, rms will compare the costs of outsourcing with the costs of internal transactions,
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costs, rms tend to outsource services. This theory has been widely used when modeling the
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outsource services of rms and apply it in many subsequent studies. According to this theory,
each rm has di erent strengths in terms of internal resources and rms need to maximize
those resources. Therefore, the outsourcing decision of rms depends on the internal resources
of the business; in other words, the rms choose to outsource activities they do not have
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Execution activities ( rst level), value-added activities (second level), planning level (third
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as transportation and warehousing is the rst level of logistics outsourcing. The emergence
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technology, management consulting, and nancial services rms. In addition, the alliance
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of enterprises. Dang (2014) studies the factors a ecting the decision of enterprises to choose a
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empathy, and price of logistics services have a signi cant in uence on the enterprise’s decision
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factors that a ect the decision to outsource logistics services of enterprises.
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important factors a ecting their decision to outsource or perform their own logistics activities.
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research model on these factors in uencing SMES’ decision to outsource logistics services.
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Empirical studies have shown that there are many factors a ecting the decision to outsource
the logistics services of enterprises. In particular, many studies have con rmed the relationship
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rms outsource logistics services due to operational and cost motives. The cost reduction
of outsourcing logistics services for companies is re ected in the savings in investments to
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is a factor that positively a ects the decisions of these companies. Therefore, the following
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Core competence is also a factor that directly a ects rms’ decision to outsource logistics
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logistics services help companies redistribute resources to develop core activities and in uence
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to e ectively allocate capital and human resources to achieve short-term and long-term goals.
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to outsource logistics services or perform these activities themselves is in uenced by the
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logistics services of that business also changes in di erent periods. Business managers need
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services of enterprises is re ected in the ability of enterprises to identify, assess, and handle
risks, especially for SMEs. This is also an in uencing factor for enterprises’ decision to
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outsourcing brings client rms technological advantages, as these business organizations
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t the needs of businesses. Besides, the diversity of logistics service providers in the market
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research model and questionnaire, qualitative analysis is rst carried out through in-depth
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Alpha test, exploratory factor analysis (EFA), con rmation factor analysis (CFA), and
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variables in the same factor, this study uses Cronbach’s Alpha coe cient of the minimum factor,

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the dependent variable DE with Cronbach’s Alpha being 0.783). The correlation coe cients of
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is the observed variable DE3 with the total correlation coe cient of 0.489), and there is no
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According to the EFA result, Sig. = 0.000<0.05 and the KMO coe cient is 0.749>0.6. This
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satis ed the criteria. As a result, the EFA results are appropriate.
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EFA show that the KMO coe cient is greater than 0.6 (0.646), the factor loadings are all
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CFA evaluates the convergent and discriminant value of the scale and the t of the model.
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greater than 0.05. This shows that the compatibility with ̣ eld data of the proposed research
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Table 7 indicates that, at a 95% con dence level, there are four factors in uencing the decision
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cost-cutting incentive has the biggest and most signi cant in uence on SMEs’ decisions
to outsource their logistical services. The ndings of this study are completely in line with
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risk management. According to research ndings, factors can in uence a choice to outsource
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The analysis shows that cost reduction is the most in uential factor in the decision to outsource
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factor in uencing the decision to outsource the logistics services of SMEs. This result is
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in uential factor in the decision to outsource logistics activities instead of performing
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and implement cost optimization based on the expansion of scale to o er competitive
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enterprise have a signi cant impact on the logistics outsourcing decision of SMEs. This result
is consistent with previous ndings in the study of Gonzalez HW DO 6KHQJ
and Nguyen (2020). The ability to nd and cooperate with professional logistics service
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in warehouses themselves, outsourcing is inevitable; however, it is very important to nd a
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e ectively will help businesses choose the right service providers.
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These ndings suggest some implications. Firstly, logistics service providers need to
optimize costs to o er a reasonable cost for services because the cost is the most important
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method. The results show that four factors a ect the decision to hire logistics services for
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sampling method with the subjects being SMEs in ve provinces and cities in Vietnam, which
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NEDUL 0 Factors a ecting outsourcing decisions in Iranian industries, RFWRUDO WKHVLV RI
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Anders, I. and Bjorn, L. (2015), “Outsourcing strategies and their impact on nancial performance
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Bandeira, R.A.M., Macada, A.C.G. and De Brito Mello, L.C.B. (2015), “Logistics outsourcing:
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