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Reducing Transaction Costs Through Digitalization: Challenges in the Order to Cash Process of Logistics Service Providers

In: Digital Transformation of Supply Chains

Author

Listed:
  • Christiaan de Goeij

    (Faculty of Business, Media and Law, Windesheim University of Applied Sciences)

  • Luca Gelsomino

    (Faculty of Economics and Business, University of Groningen)

Abstract

Logistics Service Providers (LSPs) face specific challenges in their Order-to-Cash (O2C) processes due to complex pricing structures and relatively low profit margins. In this chapter, using a multiple case study approach, we apply Transaction Cost Economics (TCE) to examine the factors leading to inefficiencies in LSPs’ O2C processes. Our research is based on four in-depth case studies of LSPs in the Netherlands, combining 19 semi-structured interviews with employees from different departments and secondary data on orders, invoices, and payments. The findings reveal that the main O2C inefficiencies stem from a lack of an integrated vision of the process as a whole, insufficient internal coordination and collaboration between departments, and challenges related to digitalization and automation, including limitations in employees’ IT skills. These insights highlight the need for LSPs to optimize their O2C processes to improve financial performance and operational efficiency.

Suggested Citation

  • Christiaan de Goeij & Luca Gelsomino, 2026. "Reducing Transaction Costs Through Digitalization: Challenges in the Order to Cash Process of Logistics Service Providers," International Series in Operations Research & Management Science, in: Yacob Khojasteh & S.M. Mousavi Jahan Abadi (ed.), Digital Transformation of Supply Chains, chapter 0, pages 257-276, Springer.
    • Handle: RePEc:spr:isochp:978-3-032-01206-7_10
    DOI: 10.1007/978-3-032-01206-7_10
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