Analysis of Logistics Service Quality (LSQ) factors among Net Promoter Score (NPS) segments for third party logistics (3PL) industry in Jordan: Development of LSQ evaluation framework & improvement matrix

Abstract

Logistics Service Quality (LSQ) is considered one of the most important tools contributing to customer satisfaction which explains the concern of Third Party Logistics service providers (3PLs) in analysing, measuring and improving their LSQ. The limited research performed investigating LSQ and customer satisfaction relationships with adequate segmentation considerations, as well as the limited managerial tools developed to improve LSQ factors in a business-to-business (B2B) context are the main motivations for this study. Therefore, the aim of the study is focused on investigating the LSQ factors that are of most importance to different types of B2B customers, which will be segmented through Net Promoter Score (NPS) latent variable. In addition to this, this work seeks to develop a tool that provides guidance for LSQ improvements in the context of 3PL industry in Jordan. This study utilised systematic literature review (SLR) process in order to identify existing published work; this was achieved through searches in 14 well-known online databases. As a result, a comprehensive LSQ evaluation framework comprising 14 LSQ factors was developed by combining all LSQ factors from previous works. Quantitative analyses were conducted based on questionnaires’ data collected from 293 B2B customers of 3PLs in Jordan. The findings of the study showed that LSQ of 3PL companies in Jordan is at a satisfactory level and supported the significance of the 14 LSQ factors in achieving B2B customer satisfaction. Further, an equation has been developed to predict B2B customer satisfaction based on LSQ factors. In addition, a significant difference in the declared and inferred LSQ importance has been found amongst NPS segments (promoters, passives and detractors) in Jordan and consequently an LSQ improvement matrix has been developed for each segment. Although the study has some limitations of being completed in one country, using crosssectional time horizon and a single key informant for data collection but it contributes to the existing body of knowledge by enhancing current understanding of LSQ factors that lead to B2B customer satisfaction and identifying priorities of LSQ factors to different segments in the 3PL industry. Further, it provides methodological contributions in the use of SLR and post-hoc segmentation. Finally, its managerial implications are useful to practitioners in the 3PL industry since the study developed a comprehensive LSQ evaluation framework and an LSQ improvement tool that can be used by 3PLs in Jordan or any other country which add value to this study.