Most authors agree that formal contracts are necessary for
effective management of 3PL relationships. However, detailed
contracts can also be interpreted as an indication of lack of trust
(Selviaridis and Spring, 2007). According to Poppo and Zenger
(2002, p. 708), for example, there are critiques that state that
‘‘in the presence of relational governance, formal contracts are at
best an unnecessary expense and at worst counter-productive’’.
Furthermore, Frankel et al. (1996) conclude that firms do not
believe that formal written contracts are an integral or necessary
component to achieve an effective alliance relationship.