Authors: Madhuri Saripalle
Addresses: Institute for Financial Management and Research, Central Express Way, Sector 24, Sricity, Chittoor District, Andhra Pradesh-517541, India
Abstract: The Indian economy has one of the highest transportation and logistics cost as a percentage of gross domestic product (13%) globally. This paper analyses trends in profitability and discusses some key macro and micro level factors influencing the Indian logistics industry comprising road transport logistics, storage and distribution. It discusses the role of macroeconomic factors such as tax policy in influencing the logistics network complexity, which in turn increase logistics costs. At a micro level, the paper uses firm-level data of 201 companies from Prowess database and estimates an econometric model to analyse major determinants of profitability in the logistics sector. The study finds that liquidity, market share, debt-equity, and age are significant determinants of profitability in the logistics sector.
Keywords: profitability; transportation; supply chain; logistics; third party logistics; 3PL; India.
International Journal of Logistics Economics and Globalisation, 2018 Vol.7 No.1, pp.13 - 27
Received: 19 Mar 2017
Accepted: 17 Jun 2017
Published online: 08 Mar 2018 *