Value Creation Of Fourth Party Logistics

Logistics management has grown rapidly with the integration of the global economy. In developed countries, logistics as a new industry is seen as a "third source of profit" after labor and natural resources. When third-party logistics are being recognized in the world logistics industry, a new logistical concept, fourth-party logistics, has increasingly attracted attention. Focused on integrating the entire supply chain, fourth-party logistics offers integrative supply solutions for enterprises. Though still in its infancy and many concerns remain, fourth-party logistics will have bright prospects in the future as demands for logistical services become more extensive and comprehensive. This article investigates value creation process in fourth-party logistics.Taking the growing globai logistics industry as background, this research investigates how value is created in fourth-party logistics. The article consists of the following six sections:Section â…  introduces the concept of fourth-party logistics. The author discusses its major characteristics and its current stage of development based on its distinction from third-party logistics.Section â…¡ discusses the processes of value and value creation, taking the perspective of value as difference in cash flow before and after value creation. The driving factors of value creations are discussed on four levels, laying the foundation for the investigation of value creation in fourth-party logistics.Section â…¢ lays the theoretical foundation for value creation in fourth-party logistics from theoretical perspectives of outsourcing, enterprise value chain management, and intellectual capital management.Section â…£, the core of this article, focuses on the detailed value creation processes in fourth-party logistics through the drivers of value creation.Section V uses a case study of Lucent (Qingdao) Corporation's CDMA project to demonstrate value creation processes in fourth-party logistics.The concluding section notes the limitations of the article, recognizing that fourth-party logistics is a new phenomenon and deserves more investigation by researchers and practitioners.