Rafiki’s Make-or-Buy Dilemma: Is It Time to Outsource Outbound Logistics Services?

Abstract

Solomon Souza is a logistics manager at Rafiki charged with improving operational performance as the company looks to expand to a new region. His department is struggling to keep up with the company’s growth and Solomon is trying to decide whether Rafiki should maintain its in-house logistics services or if it should outsource those services to improve operational performance. As he assesses Rafiki’s outbound logistics, Solomon determines that the company’s operational problem is also a strategic issue. He must evaluate the internal logistics costs and compare them to those of other logistics providers, while also weighing various qualitative elements, in order to make the best make-or-buy decision for his logistics department and his growing company.

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