The context for this research is the make or buy, i.e., the outsourcing decision, for the logistics function of motor carrier transportation of finished products between manufacturer and customer. Decisions about which business functions will be performed within the boundaries of a firm and which will be performed externally essentially address how business firms or groups of firms will be organized or structured; that is, what will constitute a firm, and what the relationships will be between affiliated firms. Transaction cost analysis, with its consideration of firm boundaries and governance strategies, provides an appropriate conceptual framework to examine the efficiency of organizing a firm's transportation of finished goods internally versus externally.