Value co-creation in an outsourcing arrangement between manufacturers and third party logistics providers: resource commitment, innovation and collaboration

Purpose: This paper aims to explore value co-creation between manufacturing firms and third-party logistics providers (3PLs). The specific focus is on resources and value co-creation with the aim to examine a set of relationships among the 3PL’s resource commitment, collaboration and innovation, and their performance outcomes. Design/methodology/approach: Survey data consisting of 142 UK manufacturing firms are used to study the 3PL and manufacturing customer value co-creation. The confirmatory factor model (CFA) and subsequent structural equation model were tested using EQS 6.1. Findings: The findings show that collaboration between the manufacturers and the 3PLs mediates the relationship between resource commitment and innovation, and performance. 3PLs are becoming much more of a collaborative partner which support the idea of value co-creation strategy. Research limitations/implications: The study is cross-sectional; temporal evolution of value co-creation should be studied in the future. Practical implications: When manufacturers and 3PLs collaborate to target efforts strategically, the 3PL’s resource commitment can be directed towards the development of new innovative approaches. Originality/value: The study contributes to the discussion of forms of co-creation, and theoretical frameworks which would enable us to understand how customers and other actors engage with the companies in collaborative value creation activities.