In the operator model, the logistics property, including the real estate assets, typically remains in the possession of the client, while the logistics service provider takes over operations. Clients are often still unsure whether this system is a suitable solution for their company. The reason for this skepticism is the surcharges that the service providers include in their calculations. Unlike conventional factor costs, the amount and composition of these payments are often difficult to understand. Many clients assume that the range is between five and fifteen percent. Wrongly, as a representative survey conducted by Logivest GmbH together with Stephan Meyer Management Consulting shows.

Kuno Neumeier, Managing Director of the Logivest Group © Logivest

Logistics consultants and clients were asked about the mark-ups of specific projects in recent years. For the analysis, the mark-up was defined as a combined percentage mark-up on the direct and indirect costs of operations in order to cover both the overheads and the profit of the contract logistics service provider. The initial scenario should be a pure warehouse logistics business and an operator model in Germany, in which the customer provides the property, assets and warehouse management system free of charge and the logistics service provider operates the facility with its own staff. Furthermore, the projects should have a contract term of at least five years and an annual turnover of three to eight million euros.

Stephan Meyer, freelance management consultant © Logivest

Mark-up calculation between nine and ten percent The result shows a clear tendency towards mark-ups of between nine and ten percent. Including outliers due to particularly large, renowned projects with lower mark-ups and smaller, risky projects with higher mark-ups, the average value of the survey is 9.7 percent. "The result is very much in line with my experience from my own projects and the increasing number of operator models on the market," says consultant Stephan Meyer. "With this result, we can provide clients with a good benchmark - and therefore also more insight when evaluating this outsourcing option."

"Our aim is to support the interaction between clients and logistics service providers and to further increase the quality of cooperation," says Kuno Neumeier, Managing Director of Logivest. Back in 2019, Logivest initiated the LogiVisor Award together with Stephan Meyer in order to bring logistics service providers and clients together on a central platform and present innovative logistics solutions. With the current analysis, the initiators are now providing an important benchmark for successful cooperation in operator models.

Operator models: Outsourcing in the classic way
Operator models are a classic form of logistics outsourcing. With this solution, the client determines the location, for example, and defines the warehouse and picking strategy based on the incoming goods and structural data. In other words, how many goods enter the warehouse, in what form and when, and how much is dispatched and how.

In the subsequent outsourcing process, the exact division of tasks between the logistics service provider and the client is defined. This is usually divided into three overarching areas: IT processing, commercial processing and physical processing. The takeover ranges from a pure pick-pack-ship service to the complete implementation of the entire operator process - for example, order acceptance, delivery and accounts receivable service. For example, the client provides the property and infrastructure, while the logistics service provider provides the staff and is responsible for handling incoming goods, warehouse administration and management, order picking and shipping. The client can thus ensure the efficiency of its logistics, save costs as the service provider can offer the task more cost-effectively and professionally and does not need to hire staff. In return, he provides the logistics space including the immovable assets and thus also keeps the property and intralogistics in his portfolio.