Supply Chain Risk Management Strategies: A Study of South African Third-Party Logistics Providers

Abstract

The purpose of this study was to determine the supply chain risk management (SCRM) strategies that South African third-party logistics (3PL) service providers use to mitigate risks, the extent to which they adopt these strategies and the benefits derived thereof. An exploratory and descriptive method technique was adopted. The empirical study comprised of email surveys administered to 398 supply chain managers employed by South African 3PLs. The findings reveal that respondents place greater importance on risk identification than on the other SCRM strategies. Risk assessment attained the lowest rating, implying that 3PL providers placed the least importance on this risk assessment strategy. Risk response and risk monitoring, reporting and control are all adopted to a significantly lesser extent. The findings also revealed that 3PL providers derive significant benefits from all SCRM strategies. A limitation of this study is that not all 3PL providers affiliated with SAAFF participated. In addition, because only members of senior management were included in the study, the opinions of operational and tactical staff were not obtained. The study contributes to the current body of knowledge on SCRM by exploring how 3PL providers in a developing country, such as South Africa, assess supply chain risks, the strategies they have in place to respond to these risks, and the mechanisms in place to monitor and control SCM risks.