A new type of logistics-based alliance is quickly gaining speed in Europe, driven, in large part, by the pressure for restructuring. These alliances represent formal or informal relationships between companies operating in a broad range of industries—and markets—and logistics service providers. Despite the current focus of such arrangements on providing "contract" logistics services, they have the potential to offer a much broader range of value-added services, including secondary manufacturing and supply chain integration.

Companies as diverse as computer manufacturers and grocery retailers are increasingly forming alliances with providers of logistics services in an attempt both to improve delivery for their customers and to reduce their own logistics costs. Even so, information on the logistics services market is scarce. National statistics are dispersed between transportation and warehousing classifications, and numbers often shift between categories when alliances are consummated. Though precise information is not available, we estimate that in Western Europe alone logistics alliances to the annual value of one to two billion dollars are now in place. They are also spreading to markets as far apart as the United States and Australia.

To find out more about logistics alliances and why their...