Distribution and warehousing are the functions most frequently outsourced to third-party logistics providers (3PLs), says the seventh annual report on third-party logistics produced by Georgia Tech, Ryder System and Cap Gemini Ernst and Young.

The study, which surveyed 260 logistics and supply chain executives from around the world, indicated that more than three-quarters of all companies—and 90 percent of those surveyed in Europe and Asia—currently outsourced some logistics services. Seventy-seven percent of those who do use 3PLs outsource distribution center or warehouse management activities. Next on the list were Webenabled communications (64 percent), transportation management (62 percent) and export/import and related activities (61 percent).

"This year's study highlights more demanding customer expectations of 3PL services and increasingly sophisticated requirements for technology-based and strategic supply chain services," says C. John Langley Jr., professor of supply chain management and 3PL study leader at Georgia Tech.