The outsourcing of logistics operations (transport, warehousing, packaging, etc.) has grown significantly over the last two decades. This trend has resulted in the logistics services market becoming better structured, with service offers that are now well defined and familiar to the potential users. However, outsourcing strategies remain very diverse, with practices that are often very different within the same industry.

The decision to make or buy must be made on the basis of a range of factors that are difficult to balance. Building a company-wide strategy shared by all the functions is, by its very nature, a difficult exercise demanding specific methodologies.

Arguments in favor of “making”:

• the cost of the interface with the service provider (physical, logical and organizational),
• the service provider's margin,
• labor unrest in the event of outsourcing,
• command of the know-how in strategic activities,
• coordination and integration of logistics into the company’s other processes (supply chain, sales, production, etc.),
• etc.

…must be compared with those in favor of “buying”:

• focus on core business,
• flexibility in times of growth or decline,
• variable costs,
• economies of scale and generation of synergies with other activities,
• professionalism and benefits on sources of costs (payroll in particular),
• etc.

Argon Consulting helps its customers in:

• the development of a make or buy strategy for its logistics operations:
  • benchmarking of internal costs compared with market prices for logistics services,
  • identification of the ROI of the internal solution (gap between costs vs. capital outlay),
  • analysis of the strategic interest of logistics operations,
  • analysis of the need for flexibility and the consequences of the impacts of internal and external options,
  • construction of an implementation plan of the strategy,
• support in the implementation of the outsourcing strategy:
  • formal specifications of the activities to be outsourced,
  • selection of the panel of potential service providers,
  • management of calls for tender,
  • comparison of the proposal and support in the negotiations and decisions,
  • drawing up of contracts,
  • support in the deployment of the purchasing processes and monitoring of the service providers.