A Fuzzy Cognitive Map Modeling to Explore the Operation Dynamics of Third-party Logistics Providers

Abstract

In Taiwan, e-tailers have formed partnerships with third-party logistics providers (3PLs) and convenience stores so that the service of shopping on-line in an electronic store and picking up goods at a convenience store could be quite common and popular these days. This study observes that the e-tailers have more bargaining power at its disposal comparing to its counterparts, 3PLs, in the sense of partnership. The study applies the methodology of "Fuzzy cognitive maps" to model and explore the operation dynamics for 3PLs. The results show that the improvement on "Relationship with e-tailers" and "Logistics performance" could significantly facilitate 3PLs in expanding the market shares, total profits and somewhat mitigating the problems 3PLs would have encountered.