With the positive outlook for the 3PL business and the
immense competition which is likely to follow, it is critical
that 3PL companies recognize that low price is not longer a
sure-win strategy. In a study by Sink, Langley and Gibson
[5], it was found that the most important selection criterion
for 3PL provider was core competencies. Thus, the
objective of this paper is to help 3PL companies identify
and categorize the challenges in the business in a broad
sense, and to discover potential gaps where research and
development can help bridge the gap. The rest of this paper
is organized as follows. In the next section, important
segments of literature on logistics outsourcing are
reviewed. Subsequently, the broad categorization of 3PL
challenges is described, followed by detailed discussion
and potential gaps identification. Some of the challenges
will be related to the interviews conducted with two 3PL
companies. Finally, the list of future research directions is
given at the end.