Abstract:
Many manufacturers and retailers often outsource their logistics
functions to logistics service providers (LSPs) to focus more on their core
business process. Due to the competitiveness and the popularity of the
sustainability concept, those organisations evaluate their prospective LSPs not
only based on economic aspects but also social and environmental aspects. This
paper proposes a framework that can be used by organisations when evaluating
and selecting LSPs based on their sustainability performance. A composite
sustainability performance index (CSPI) is constructed, incorporating multiple
dimensions and indicators related to economic, social, and environmental
aspects, which are widely used to measure sustainability performance. A linear
programming (LP) model is then proposed, which allows the organisations to
decide the desired number of LSPs after considering all requirements and
limitations. The proposed framework is flexible as it depends on the
sustainability requirements of the organisation when selecting LSPs.
