Evolution of third party logistics sector and developing a network system between a third party logistics provider and its customer

ABSTRACTEVOLUTION OF THIRD PARTY LOGISTICS SECTOR ANDDEVELOPING A NETWORK SYSTEM BETWEEN A THIRD PARTYLOGISTICS PROVIDER AND ITS CUSTOMERAhmet Serhat ULUDAĞMaster ThesisDepartment of Bussines AdministrationThesis Advisor: Associate Prof. smail EROLJune, 2006, 143 pagesIn this thesis, first, third party logistics (3 PL) as a concept is analyzed indetail and the development of 3 PL industries in Turkey and other countries isdemonstrated by reviewing the related literature. In the second phase, the decisionmaking processes of 3 PL industries whose conceptual aspects and progress havebeen displayed are emphasized. Once these decisions have been clarified as strategic,tactical and operational level, supply chain network problems included in strategiclevel decisions have been decided to be our main scope. Supply chain networkproblems consist of sophisticated problems which require utilizing quantitativemodels. Therefore, in this thesis, three alternative mixed integer programmingmodels are developed to solve a supply chain network problem based on a case studyregarding a 3 PL company and retailer. The models that coordinate supply chainnetwork between a 3 PL company and retailer aim to determine the amount ofproducts delivered to the warehouses and stores from suppliers and warehouses,respectively, and to calculate the number of warehouses that minimize the totalsystem cost. The proposed models are solved using CPLEX 8.01, which is acommercial software package, and the results obtained are displayed on the tablesand explained in details. Finally, alternative solutions derived by a sensitivityanalysis are generated and demonstrated to the decision makers.Key Words: Logistics, Third Party Logistics, Mixed Integer Linear Programing,Supply Chain Netwok Design