American Journal of Business Management, Economics and Banking 
ISSN (E): 2832-8078                               Volume 11, | April, 2023                                

 

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POSSIBILITIES OF USING OUTSOURCING IN THE PROVISION OF 

TRANSPORT AND LOGISTICS SERVICES  
Kadyrov T.U.  

Department of “Methodological Provision of Education  

System” of the Graduate School of Business and Entrepreneurship 

 

A B S T R A C T K E Y W O R D S 

This article highlights the importance of outsourcing in the provision of 

transport and logistics services, and systematizes the group of factors that 

encourage such activity. A method of evaluating the economic 

effectiveness of outsourcing and criteria for evaluating the description of 

the outsourcing's execution capabilities are proposed 

transport-logistics 

services, outsourcing, 

insourcing, outsourcer, 

insourcer, economic 

efficiency. 

 

INTRODUCTION 

Relationships between business entities based on outsourcing have recently been more and more 

widely used in foreign practice. 

The term "Outsourcing" is derived from the abbreviation of the words "Outsider Resource Using" 

(resource use by external organizations), and contractual relations basically mean the use of resources 

(production or service activities) of other enterprises and organizations instead of their own resources. 

In recent years, all types of production and service activities are carried out by companies in all sectors 

of the economy in the framework of mutual cooperation based on outsourcing. 

As a result of the conducted research, outsourcing is defined as an integral part of the management 

strategy related to the provision of certain components or processes of the enterprise (insourcer) related 

to the production or provision of services to an external executive (outsourcer) on the basis of the rules 

of division of labor, stable business cooperation and mutual economic interest. can be given. 

At first glance, outsourcing appears as a form of mutual cooperation. However, it differs from ordinary 

organizational-economic relations in the following ways: 

- guarantee of the scope and quality of the work assigned to him by the external executor; 

- an open price policy between partners for the work performed or the services provided (the agreed 

price and the objectivity of making adjustments to it); 

- mutual cooperation and long-term business relations; 

- the authority to make corrections or changes to the technological processes of outsourcing as agreed 

by the outsourcer; 

- joint responsibility of the outsourcer and contractor for product quality, delivery terms and other 

conditions, etc. 

Also, in outsourcing, a complete list of participants and the type of work performed by them should be 

provided in the creation of the product or service provided to them according to the requirements of 



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consumers. If these types of services require special licenses, this is one of the necessary conditions 

based on the established legislation. Then, it is possible to achieve proportional provision of 

responsibility of the outsourcer and the customer in conflict situations arising from the performance of 

contractual obligations between the transport service provider and the consumer. 

In the logistics system, it is appropriate for the customer to use outsourcing in the following cases: 

- if the company does not have enough experience and knowledge in logistics activities; 

- if the quality of service and level of service increases; 

- if a synergistic effect is achieved by ensuring service reliability; 

- if outsourcing does not conflict with the company's strategic goals. 

Of course, its synergistic efficiency is of primary importance for the customer when making a decision 

on outsourcing, which is manifested in the following cases: 

- achieving economic efficiency by reducing costs per product unit due to the expansion of the scope 

of activity and the increase in the production volume; 

- combined effect due to the complementarity of the customer's and outsourcer's resources; 

- reduction of the customer's transaction costs due to outsourcing; 

- increase in the possibility of applying innovative achievements in production. 

It is worth noting that the effectiveness of outsourcing is ensured for the enterprises performing it only 

if the order given by the customer is attractive and profitable. Because they will be interested in both 

long-term cooperation and high profit in their work. Otherwise, even if there is a demand for 

outsourcing among customers, it will be difficult to implement it in practice, or it may not be 

implemented at all. 

In our opinion, the main factors encouraging the use of outsourcing in the provision of transport and 

logistics services in the road transport system are as follows: 

1. Provision of transport and logistics services of various types of motor vehicles, trailers, semi-trailers, 

special trailers, refrigerators, loading and unloading mechanisms, technological equipment for 

maintenance and repair of vehicles, cargo handling equipment, storage warehouses and other technical 

is carried out by using technological means. This naturally requires attracting a large amount of capital 

and investments in order to have these technical means. In conditions of limited material and financial 

capabilities of transport operators, they outsource some types of transport-logistics operations in order 

to fully satisfy the needs and demands of customers. In this case, if the financing of the execution of 

these operations is carried out by an outsourcer, the costs are covered by the payment made by the 

consumer for the services provided, together with the added value. 

2. Quality of transport and logistics services. In some cases, even if transport operators have the 

technical and technological capabilities of providing transport-logistics services in the required 

volume, they cannot implement the quality level of some of their types at the level of competitors' or 

customers' requirements. This situation also encourages the outsourcing of some components of 

service provision. 

3. In the full implementation of transport-logistics operations, it can be expensive for companies to 

keep highly qualified specialists, they can be attracted from time to time on the basis of outsourcing. 

For example, in evaluating or certifying the quality of transport and logistics services, conducting 

marketing research, solving complex technical and technological problems that rarely occur in the use 

of transport vehicles and technological equipment, forwarding special cargo, operations related to 

catering or other comfort during passenger transportation, etc. attract qualified specialists. 



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4. Transport-logistics services at motor transport enterprises, i.e. insourcing them when there is a 

reserve in production capacity, renting vehicles and technological equipment based on outsourcing in 

case of shortage, and other operations; 

5. Providing services to clients on the basis of an individual approach, to ensure that some of the 

services requested by them are performed together with the external executors offered by them, etc. 

Based on the analysis of these factors, it is possible to systematize the advantages and disadvantages 

of outsourcing in the provision of transport and logistics services (Table 1). 

Based on the analysis of the forms and methods of outsourcing in the logistics system in international 

practice, the following forms of outsourcing can be widely used in the provision of road transport 

services: 

- outsourcing of transport production components; 

- outsourcing of transport functions (transportation, loading and unloading, warehouse service, storage, 

etc.). 

Table 1 Advantages and disadvantages of using outsourcing in transport-logistics services 

№ 

The field of activity of 

the motor transport 

enterprise 

The advantage of using outsourcing Disadvantage of using outsourcing 

1. Operation of vehicles 

1. Achieving high operational qualities; 

2. Maximum use of transport potential; 

3. Achieving production flexibility; 

4. Achieving high innovation. 

1. Lack of full control over 

production quality; 

2. Requires special experience; 

3. Increase in risks at the rate of 

production; 

2. Economic activity 

1. Decrease in capital expenditure; 

2. Cost reduction; 

3. Payment for technical and technological 

means only in the amount used; 

4. Increase in cash flows. 

 

1. Increase in the volume of economic 

relations; 

2. Increase in administrative activity 

3. Management activities 

1. Focusing on the main activity; 

2. Reduction of management personnel and 

assets; 

3. High labor productivity and 

management efficiency. 

1. Disclosure of know-how; 

2. Decrease in relations with clients; 

3. The dependence of management 

efficiency on the management system 

of partners. 

 

For customer companies, in order to provide transport-logistics services in the volume, quality and 

price required by customers, it is important to evaluate its economic efficiency when making a decision 

regarding the formation of an order to outsourcing and its implementation. Based on this research task, 

we found it necessary to propose the simplest and most reliable method of its assessment that can be 

used by the general public. It can be expressed as (Ia): 

Ia=∑_(i=1)^n▒(C_i-C_ai-C_ti ) (1) 

Here: C_i – costs of performance of type i-transport-logistics services by the ordering operator, soums; 

C_ai - costs of outsourcing of i-transport-logistics services type, soums; 

C_ti - transaction costs spent on the outsourcing of the type of i-transport-logistics services, soums. 

(1) in order for the expression to be meaningful, the following condition must be fulfilled: 

C_i≥(C_ai-C_ti) (2) 



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It should be noted that in practice, customers do not always set the main goal of obtaining economic 

benefits from outsourcing. To implement it: 

- lack of material, financial and labor resources; 

- limited innovation potential; 

-lack of experience in some jobs; 

-customers demand that certain operations be performed by the company they want; 

- not being able to ensure the required quality of performance even from the cost of transport-logistics 

services; 

- the need to strengthen the competitive position of the motor transport enterprise with low prices and 

high quality, and other circumstances may be more important. In this case, the synergistic effect of 

outsourcing is more important for the customer. 

Therefore, when using outsourcing for customer transport operators, a comparative description of the 

extent to which the outsourcer fulfills the order also plays an important role (Table 2). 

 

Table 2 Criteria for evaluating the description of the performance capabilities of the outsourcer 

№ 
A descriptive sign of 

outsourcing 
Evaluation criteria 

Sample value 

of the grade, % 

(X=1÷100) 

The actual 

possibility of the 

outsourcer, 

(Y=0÷1) 

1 2 3 4 5 

1. Technical capabilities 
Compliance of the contractor's field of 

activity and experience with the order 
  

2. 
Technological 

possibilities 

Compliance of order fulfillment 

technologies and methods with regulatory 

requirements 

  

3. Production capacities 
Possession of production capacity to 

perform the required volume of work 
  

4. Management options Ability to manage and develop outsourcing   

5. Staff capacity 
Sufficient composition and qualifications 

of the personnel executing the order 
  

6. Financial opportunities 
Possession of financial resources to 

perform the required amount of work 
  

7. 
Patent and intellectual 

property rights 

Preservation of intellectual property rights 

of the outsourcer in the execution of the 

order 

  

8.  Innovative potential The level of innovation in order fulfillment   

9. 
Recommendations and 

reviews 

Availability of positive reviews and 

recommendations from other customers 
  

  Total Ʃ=100 Ʃ=0÷9 

 

In the integral assessment of the outsourcer’s performance capabilities, expert methods are used to 

calculate the weights of its individual indicators (9 in our example). In the expert assessment, sample 

indicators are calculated in percentages, the average value of their weights is calculated, and their sum 

is equal to 100. 

After determining the weight of the sample indicators, the capabilities of a selected outsourcer are 

evaluated from 0 to 1 points according to the specified indicators. If the indicator of the outsourcer 



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according to any criterion fully matches the sample, it is evaluated with 1 point. It is appropriate to 

evaluate them in an expert manner. 

 

Literature 

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predprinimatelstvo. 2010. No. 12 (2). S. 60-66. 

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