Third party purchase: an empirical study from the Chinese automotive industry

Third-party purchases (3PP) offered by third-party logistics (3PL) providers are a new concept in the contemporary business context. The primary objective of our study is to explore a possible method of improving relationships between 3PP service providers and suppliers in China's automotive industry. We analyse a 3PP service provider by interviewing its employees and suppliers. A qualitative research method was employed using a single case study protocol. We deliberately selected a 3PP service provider operating in the automotive industry. We then collected empirical data via face-to-face interviews with well-informed 3PP employees and a cross-section of 32 suppliers. The major finding of this study is that 3PP service providers not only help to improve operational efficiency, but they also reduce prices for their clients. The study comprehensively analyses the implementation of 3PP in the automotive industry in China.