The Logistics Sector on the Southern Shores of the Western ... - cetmo

October 2010<strong>The</strong> <strong>Logistics</strong> <strong>Sector</strong>on the Southern Shores of the Western Mediterranean<strong>Logistics</strong> has become professionalized and today is seen as a service activity in its own right,standing apart from production and retail distribution. This has led to dynamic subcontractinglogistics operations encouraged by an increase in competition, the need toreduce costs and the geographical expansion of markets.Operators’ different levels of logistic maturity and service capacity can be identified accordingto the degree to which they sub-contract operations:<strong>The</strong> first level is made up of clients who only sub-contract transport operations andmake use of 1PL (First-Party <strong>Logistics</strong>) providers. <strong>The</strong> second level corresponds toclients who outsource their transport and warehousing operations, which they entrustto 2PL (Second-Party <strong>Logistics</strong>) providers.It is only at the third level (3PL, Third-Party <strong>Logistics</strong>) that providers can begin to beconsidered as logistics operators and that outsourcing can properly be qualified aslogistics sub-contracting. This type of operator needs to have the means at itsdisposal (which can be sub-contracted) to achieve agreed objectives, but also thenecessary technological tools, knowledge and organization. At the fourth level, 4PL(Fourth-Party <strong>Logistics</strong>), providers are responsible for the optimization of a globalchain that includes their client as well as its clients and suppliers in turn (including the3PL providers operating in certain zones).<strong>The</strong> logistics sector is formed by all the operating companies, both public and private, thatprovide transport or logistics services. Currently, these operators are considered to be part ofa much broader group known as a logistics cluster.According to Michael Porter's classic definition, a cluster is a group of companies andinstitutions in the same geographical area that share skills in the same field and havecomplementary characteristics in common.Besides its strategic and operation potential, the cluster concept offers a completerepresentation of all the players in the logistics sector, since it includes businesses involvedin the same sector of activity that are in competition but can also cooperate in order toimprove their market position. It is therefore the concept used in this study to describe thelogistics sector.<strong>The</strong> conceptual map of a logistics cluster comprises five player types:<strong>Logistics</strong> and transport operators: these companies supply the basic services andform the basic core of the cluster.Clients: their number, type and requirement level contribute (or fail to contribute) tothe development of the service provision.Suppliers: these are suppliers of infrastructure, infostructure, transport and handlingequipments and technology.Support sectors: these supply ancillary services, which are even more necessarygiven the increase of tailored services and expanding markets.Other players: these are essentially associations and professional organizations thatsupport the logistics sector.<strong>The</strong> diagram below is a conceptual map of the main players involved in a logistics cluster.<strong>The</strong> description of the cluster is further refined in the chapters on each country studied.18 CETMO