Unlocking Logistics Efficiency: The Strategic Role of Third-Party Logistics (3PL) in Indonesia’s Manufacturing Sector
DOI:
https://doi.org/10.61194/sijl.v3i3.885Keywords:
Third-Party Logistics, Indonesia, Manufacturing Sector, Logistics Efficiency, Supply Chain, Scalability, OutsourcingAbstract
This study investigates the impact of third-party logistics (3PL) outsourcing on the efficiency of Indonesia’s manufacturing sector, a key industry burdened by high logistics costs, infrastructural deficiencies, and regulatory fragmentation. The objective is to determine whether 3PL adoption enhances logistics performance by reducing costs, improving scalability, and mitigating operational inefficiencies. Employing a mixed-method approach, the research draws on secondary data from industry reports and academic literature. Key performance indicators such as logistics cost structures, response time to demand changes, and integration risk severity were analyzed to compare in-house logistics operations with outsourced 3PL models. Results demonstrate significant cost reductions through 3PL - 41.7% in warehousing, 40% in transportation, and 20% in labor alongside enhanced scalability and responsiveness. 3PL providers achieved higher adaptability in managing demand fluctuations, requiring only 3 weeks to scale up operations versus 8 for in-house logistics. However, risks including IT system mismatches (72% frequency), SLA misalignments, and data security concerns were also prevalent. The findings confirm that 3PL offers a viable solution for improving logistics efficiency, provided that integration risks are carefully managed. Long-term 3PL partnerships yield financial as well as strategic benefits, including access to advanced technologies and greater operational agility. For Indonesia to fully realize the advantages of 3PL, coordinated efforts are needed from both the government and private sector to address regulatory bottlenecks, improve infrastructure, and support digital transformation.
References
Alkhatib, S. F. S. (2017). Strategic Logistics Outsourcing: Upstream-Downstream Supply Chain Comparison. Journal of Global Operations and Strategic Sourcing, 10(3), 309–333. https://doi.org/10.1108/jgoss-08-2016-0024 DOI: https://doi.org/10.1108/JGOSS-08-2016-0024
Ardi, A., Ananda, A., Rusdinal, R., Giastituati, N., & Hervi, F. (2024). A Comparison of Science Education Between Germany, China and Indonesia. Jurnal Eksakta Pendidikan (Jep), 8(1), 73–85. https://doi.org/10.24036/jep/vol8-iss1/806 DOI: https://doi.org/10.24036/jep/vol8-iss1/806
Asian, S., Pool, J. K., Nazarpour, A., & Tabaeeian, R. A. (2019). On the Importance of Service Performance and Customer Satisfaction in Third-Party Logistics Selection. Benchmarking an International Journal, 26(5), 1550–1564. https://doi.org/10.1108/bij-05-2018-0121 DOI: https://doi.org/10.1108/BIJ-05-2018-0121
Baglio, M., Creazza, A., & Dallari, F. (2023). The “Perfect” Warehouse: How Third-Party Logistics Providers Evaluate Warehouse Features and Their Performance. Applied Sciences, 13(12), 6862. https://doi.org/10.3390/app13126862 DOI: https://doi.org/10.3390/app13126862
Baidoo-Baiden, S. A. (2022). 3PL Relationship Management Practices as a Cost Reduction Tool in the Supply Chain: A Case of Stellar Logistics. American Journal of Supply Chain Management, 7(1), 1–18. https://doi.org/10.47672/ajscm.1175 DOI: https://doi.org/10.47672/ajscm.1175
Bajec, P., & Tuljak-Suban, D. (2019). An Integrated Analytic Hierarchy Process—Slack Based Measure-Data Envelopment Analysis Model for Evaluating the Efficiency of Logistics Service Providers Considering Undesirable Performance Criteria. Sustainability, 11(8), 2330. https://doi.org/10.3390/su11082330 DOI: https://doi.org/10.3390/su11082330
Baruffaldi, G., Accorsi, R., Manzini, R., & Ferrari, E. (2020). Warehousing Process Performance Improvement: A Tailored Framework for 3PL. Business Process Management Journal, 26(6), 1619–1641. https://doi.org/10.1108/bpmj-03-2019-0120 DOI: https://doi.org/10.1108/BPMJ-03-2019-0120
Chernova, O., Li, L., & Wang, X. (2023). Role of Digitalization of Logistics Outsourcing in Sustainable Development of Automotive Industry in China. R-Economy, 9(2), 123–139. https://doi.org/10.15826/recon.2023.9.2.008 DOI: https://doi.org/10.15826/recon.2023.9.2.008
Evangelista, P., Santoro, L., & Thomas, A. (2018). Environmental Sustainability in Third-Party Logistics Service Providers: A Systematic Literature Review From 2000–2016. Sustainability, 10(5), 1627. https://doi.org/10.3390/su10051627 DOI: https://doi.org/10.3390/su10051627
Govindan, K., Khodaverdi, R., & Vafadarnikjoo, A. (2016). A Grey DEMATEL Approach to Develop Third-Party Logistics Provider Selection Criteria. Industrial Management & Data Systems, 116(4), 690–722. https://doi.org/10.1108/imds-05-2015-0180 DOI: https://doi.org/10.1108/IMDS-05-2015-0180
Haris, E., Saidin, OK., Sirait, N. N., & Kaban, M. (2022). Strengthening National Logistic Ecosystem to Increase Indonesia Competitiveness in International Trade. https://doi.org/10.2991/assehr.k.220204.038 DOI: https://doi.org/10.2991/assehr.k.220204.038
Hidayati, F., & Pheungpha, N. (2023). Should Network Governance Shape the Collaboration? A Case in Indonesia’s Palm Oil Industry. 239–248. https://doi.org/10.2991/978-2-38476-082-4_23 DOI: https://doi.org/10.2991/978-2-38476-082-4_23
Iskandar, T., & Arifin, R. (2023). Navigating Indonesia’s Logistics and Supply Chain Challenges: A Data-Driven Analysis of Logistics Performance Index. Jurnal BPPK Badan Pendidikan Dan Pelatihan Keuangan, 16(1), 110–123. https://doi.org/10.48108/jurnalbppk.v16i1.820 DOI: https://doi.org/10.48108/jurnalbppk.v16i1.820
Kaur, K. (2021). Business Intelligence on Supply Chain Responsiveness and Agile Performance: Empirical Evidence From Malaysian Logistics Industry. International Journal of Supply Chain Management, 6(2), 31–63. https://doi.org/10.47604/ijscm.1351 DOI: https://doi.org/10.47604/ijscm.1351
Langkamp, D. L., Barnes, A. J., & Zuckerman, K. E. (2021). Secondary Analysis of Existing Data Sets for Developmental Behavioral Pediatrics. Journal of Developmental & Behavioral Pediatrics, 42(4), 322–330. https://doi.org/10.1097/dbp.0000000000000915 DOI: https://doi.org/10.1097/DBP.0000000000000915
Mageto, J., Prinsloo, G., & Luke, R. (2018). The Extent of Logistics Outsourcing Among Small and Medium-Sized Manufacturing Enterprises in Nairobi. Journal of Transport and Supply Chain Management, 12. https://doi.org/10.4102/jtscm.v12i0.346 DOI: https://doi.org/10.4102/jtscm.v12i0.346
Moeis, A. O., Zagloel, T. Y. M., Hidayatno, A., Komarudin, K., & Guo, S. (2017). Designing Indonesian Liner Shipping Network. Jurnal Teknik Industri, 19(1), 47–54. https://doi.org/10.9744/jti.19.1.47-54 DOI: https://doi.org/10.9744/jti.19.1.47-54
Nursyifa, N. (2023). Strategies to Improve Logistics Cost Efficiency in Indonesia. J. Log. & SC., 3(1), 23–34. https://doi.org/10.17509/jlsc.v3i1.62207 DOI: https://doi.org/10.17509/jlsc.v3i1.62207
Nyameboame, J., & Haddud, A. (2017). Exploring the Impact of Outsourcing on Organizational Performance. Journal of Global Operations and Strategic Sourcing, 10(3), 362–387. https://doi.org/10.1108/jgoss-01-2017-0001 DOI: https://doi.org/10.1108/JGOSS-01-2017-0001
O’Connor, S. (2020). Secondary Data Analysis in Nursing Research: A Contemporary Discussion. Clinical Nursing Research, 29(5), 279–284. https://doi.org/10.1177/1054773820927144 DOI: https://doi.org/10.1177/1054773820927144
Pradita, S. P., Ongkunaruk, P., & Leingpibul, T. (2020). The Use of Supply Chain Risk Management Process (SCRMP) in Third-Party Logistics Industry: A Case Study in Indonesia. Industria Jurnal Teknologi Dan Manajemen Agroindustri, 9(1), 1–10. https://doi.org/10.21776/ub.industria.2020.009.01.1 DOI: https://doi.org/10.21776/ub.industria.2020.009.01.1
Prataviera, L. B., Tappia, E., Perotti, S., & Perego, A. (2021). Estimating the National Logistics Outsourcing Market Size: A Multi-Method Approach and an Application to the Italian Context. International Journal of Physical Distribution & Logistics Management, 51(7), 764–784. https://doi.org/10.1108/ijpdlm-07-2020-0243 DOI: https://doi.org/10.1108/IJPDLM-07-2020-0243
Reza, S., Mubarik, M. S., Naghavi, N., & Nawaz, R. R. (2020). Relationship Marketing and Third-Party Logistics: Evidence From Hotel Industry. Journal of Hospitality and Tourism Insights, 3(3), 371–393. https://doi.org/10.1108/jhti-07-2019-0095 DOI: https://doi.org/10.1108/JHTI-07-2019-0095
Rezaei, J., Roekel, W. S. v., & Tavasszy, L. (2018). Measuring the Relative Importance of the Logistics Performance Index Indicators Using Best Worst Method. Transport Policy, 68, 158–169. https://doi.org/10.1016/j.tranpol.2018.05.007 DOI: https://doi.org/10.1016/j.tranpol.2018.05.007
Shi, R., Bao-jun, Y., Chu, Z., & Lai, F. (2024). The Role of Relationship Commitment in Managing Logistics Outsourcing in the Digital Economy. Industrial Management & Data Systems, 124(7), 2440–2466. https://doi.org/10.1108/imds-07-2023-0497 DOI: https://doi.org/10.1108/IMDS-07-2023-0497
Subiyanto, E. (2021). Investigating the Logistics Costs Model: Recent Update in Indonesia. Journal of Science and Technology Policy Management, 12(2), 331–350. https://doi.org/10.1108/jstpm-03-2020-0034 DOI: https://doi.org/10.1108/JSTPM-03-2020-0034
Thai, V. V., Rahman, S., & Tran, M. D. (2021). Revisiting Critical Factors of Logistics Outsourcing Relationship: A Multiple-Case Study Approach. The International Journal of Logistics Management, 33(1), 165–189. https://doi.org/10.1108/ijlm-10-2020-0394 DOI: https://doi.org/10.1108/IJLM-10-2020-0394
Torriero, S., Mattavelli, G., Gerfo, E. L., Lauro, L. J. R., Actis-Grosso, R., & Ricciardelli, P. (2019). FEF Excitability in Attentional Bias: A TMS-EEG Study. Frontiers in Behavioral Neuroscience, 12. https://doi.org/10.3389/fnbeh.2018.00333 DOI: https://doi.org/10.3389/fnbeh.2018.00333
Triantoro, W. (2020). Comparative Cost Analysis of Domestic Container Shipping Network: A Case Study of Indonesian Sea-Toll Concept. Jurnal Penelitian Transportasi Laut, 22(1), 33–46. https://doi.org/10.25104/transla.v22i1.1535 DOI: https://doi.org/10.25104/transla.v22i1.1535
Vlachos, I., & Polichronidou, V. (2023). Multi-Demand Supply Chain Triads and the Role of Third-Party Logistics Providers. The International Journal of Logistics Management, 35(1), 136–157. https://doi.org/10.1108/ijlm-04-2022-0161 DOI: https://doi.org/10.1108/IJLM-04-2022-0161
Vouzas, F., & Katsogianni, T. (2018). TQM Implementation in 3PL Organisations vs Organisations With in-House Logistics Department. The TQM Journal, 30(6), 749–763. https://doi.org/10.1108/tqm-10-2017-0115 DOI: https://doi.org/10.1108/TQM-10-2017-0115
Wang, C., Nguyen, N.-A.-T., Dang, T., & Lu, C.-M. (2021). A Compromised Decision-Making Approach to Third-Party Logistics Selection in Sustainable Supply Chain Using Fuzzy AHP and Fuzzy VIKOR Methods. Mathematics, 9(8), 886. https://doi.org/10.3390/math9080886 DOI: https://doi.org/10.3390/math9080886
Weston, S. J., Ritchie, S. J., Rohrer, J. M., & Przybylski, A. K. (2019). Recommendations for Increasing the Transparency of Analysis of Preexisting Data Sets. Advances in Methods and Practices in Psychological Science, 2(3), 214–227. https://doi.org/10.1177/2515245919848684. DOI: https://doi.org/10.1177/2515245919848684
Downloads
Published
How to Cite
Issue
Section
License
Copyright (c) 2025 Ahnis Zulkarnain
This work is licensed under a Creative Commons Attribution 4.0 International License.
