First Draft Betty Proposal 2

EFFECT OF LOGISTICS MANAGEMENT PRACTICES ON
CUSTOMER SERVICE PERFORMANCE OF EABSC ETHIOPIA

(COCA-COLA PLC) ADDIS ABABA:
By
Betelhem Mamush
UNITY UNIVERSITY ADAMA CAMPUS

DEPARTMENT OF BUSINESS MANAGEMENT
MBA PROGRAM
July, 2020
Adama, Ethiopia
A Thesis Submitted to Department of Business Management in

Partial Fulfillment of the Requirements for the award of Master’s
Degree in Business Administration (MBA)
By
Betelhem Mamush
Advisor: Bekele Reta (Asst. Prof)
UNITY UNIVERSITY
FACULTY OF BUSINESS AND SOCIAL SCIENCES
DEPARTMENT OF BUSINESS MANAGEMENT
MBA PROGRAM
July, 2020
Adama, Ethiopia
Letter of Approval
Prepared by: Betelhem Mamush
Approved By a Board of Examiners
___________________ _____________ __________
Chair Person Signature Date
___________________ _____________ _________
Internal Examiner Signature Date
___________________ _____________ _________
External Examiner Signature Date

Declaration
I, the undersigned, declare that, this study “Effect of Logistics Management Practices on
Customer Service Performance of EABSC Ethiopia: Addis Ababa” is my original work and has
not been presented for a degree in any other university, and that all sources of materials used for
the study have been duly acknowledged.
Declared by:
Name: Betelhem Mamush
Signature: ______________
Date: __________________
Confirmation
This is to certify that Betelhem Mamush has carried out this thesis on the topic entitled “Effect of
Logistics Management Practices on Customer Service Performance of EABSC Ethiopia: Addis
Ababa” Under my supervision. Accordingly, I here assure that her work is appropriate and
standard enough to be submitted for the partial fulfillment of the requirements for the award of
Masters Degree in Business Administration.
Bekele Reta (Asst.pro.)
Signature: ______________
Date: __________________
ACKNOWLEDGMENT
I wish to extend my deepest gratitude to my advisor Yehualashet Demeke (Ph.D.) for his
professional guidance and advice throughout my study.
I also want to sincerely thank BGI Ethiopia, BGI Ethiopia employees and customers (employees
of agent distributers and retailers) for the assistance they accorded to me during data collection
period. In addition, my heartfelt appreciations to the staff of Unity University Adama campus for
their unreserved support during the research study.
Finally, my acknowledgement extends to all my family and friends for their unreserved
encouraging support to accomplish this study.
Table of Contents
Abstract.......................................................................................................................................................5
CHAPTER ONE: INTRODUCTION..........................................................................................................6
1.1. Background of the study................................................................................................................6
1.2. Statement of the problem..............................................................................................................8
1.3. Research Questions:.....................................................................................................................11
1.4. Objectives of the Study................................................................................................................11
1.4.1. General Objective....................................................................................................................11
1.4.2. Specific Objectives...................................................................................................................11
1.5. Significance of the Study..............................................................................................................12
1.6. Scope of the study.........................................................................................................................12
CHAPTER TWO: REVIEW OF RELATED LITERATURES...........................................................13
2.1. Theoretical Review of Related Literature..................................................................................13
2.1.1. Concept of Logistics..............................................................................................................13
2.1.2. Logistics Management...........................................................................................................16
2.1.3. Logistics Management Practices............................................................................................17
2.1.3.1. Information Flow Management..........................................................................................17
2.1.3.2. Transport Management......................................................................................................18
2.1.3.3. Physical Distribution..........................................................................................................20
2.1.3.4. Inventory Planning and Management.................................................................................21
2.1.3.5. Warehousing Management................................................................................................22
2.1.4. Customer Service...................................................................................................................23
2.2. Empirical Review of Related Literature.....................................................................................26
2.2.1. The Impact of LMPs on Customer Service Performance.......................................................26
2.3. Conceptual Framework of the Study..........................................................................................30
CHAPTER THREE: RESEARCH DESIGN AND METHODOLOGY.............................................31
3.1. Research Approach....................................................................................................................31
3.2. Research Design........................................................................................................................31
3.3. Types and Sources of Data........................................................................................................31
3.4. Population..................................................................................................................................31
3.5. Sample size determination.........................................................................................................32
3.6. Sampling Techniques.................................................................................................................32
3.7. Data Collection Instruments......................................................................................................32
3.8. Method of data analysis.............................................................................................................33
3.9. Ethical Clearance.......................................................................................................................33
4. Time and Budget Schedule................................................................................................................34
4.1. Time Schedule...............................................................................................................................34
4.2. Budget Schedule............................................................................................................................34
Reference...................................................................................................................................................35
Abstract
The main aim of the proposed study is to examine the effect of logistics management practices on
customer service performance of coca cola Ethiopia. To study the effect of logistics management
practices five dimensions of LM practices are selected to be used as independent variables and
will intend to tests the respondents understanding perspectives on the effect of Logistics
Management practices on customer service performance. From the total target population a
sample of 306 employees or samples intended to be taken as a sample based on Yamane’ (1967)
sampling formula, using non probability sampling techniques. The data will be collected through
structured questionnaires with closed ended statements questions. The Collected data will be
analyzed through SPSS version 25 by running descriptive statistics, correlation and regression
to identify the characteristics of variables under study and to investigate the relationship
between the independent variable of logistics management practice with customer service
performance and its impact on the dependent variables customer service performance.
Key word: Logistics, Logistics Management Practices, customer Service Performance

CHAPTER ONE
INTRODUCTION
1.1. Background of the study
The challenges of global competition increasingly poses to firms have prompted the shift
towards a greater focus on customer needs and expectations in order to reduce costs by
improving service quality and efficiency (Lai & Cheng 2009). Therefore, Customer service is an
important means of differentiation from competitors, setting the components of customer service
and quantifying the level of service are means of keeping the company’s competitive advantage.
According to Martin Christopher (2007), the role of customer service is to provide time and
place utilities in the transfer of goods and services between the manufacturer and the customer.
In another form, the product has no value until it is in the hands of the customer. That’s why in
recent years organizations have focused on delivering customer value through logistics as a
measure of remaining superior (Mentzer, John T., Daniel J. Flint, and G. Tomas M. Huit (2001).
Logistics is defined as maximizing internal and external flexibility aiming at, for instance,
customization. This implies that logistics has become focused on meeting customers’ service
requirements and is considered as a key source to company’s competitive advantage (Mentzer et
al. 2001).
Logistics is the responsibility to design and administer systems to control movement and
positioning of raw materials, work-in process, and finished inventories at the minimum total cost
(Bowersox, Closs, & Cooper, 2007). Logistics means planning and organizing activities that
ensure that resources are in place so that the process can be effectuated accordingly in efficient
and effective manner (Mellat-Parast and Spillan, 2014). Thus, Logistics encompasses all of the
information and material flows throughout an organization. It includes everything from the
movement of a product or from a service that needs to be rendered, through to the management
of incoming raw materials, production, the storing of finished goods, its delivery to the customer
and after-sales service (Ittmenn & King, 2010). Accordingly, logistics is strategically important
in many industries as it is central to achieving competitive advantage (Kenyon and Meixell,
2007). That’s way managing the logistics process is an important part of management function.
Logistics performance is highly dependent on the quality, efficiency and effectiveness of the
managerial involvement in the transportation of raw materials/products in a supply chain (Ülgen
& Forslund 2015). Consequently, it affects the production speed, capacity to fill the customer
orders, delivery flexibility, and creation of an efficient delivery system that meets customers’
needs (Forslund 2012). In simpler terms, logistics performance measurements can be
summarized as the ability to process orders in the shortest time at the lowest cost without
affecting service and product quality (Kersten & Koch 2010). The ultimate aim of logistics is to
respond to customer needs while minimizing logistics costs. As logistics performance
measurement is typically based on customer order fulfillment, it consists of delivery reliability or
perfect order fulfillment and responsiveness or order fulfillment lead times (Supply Chain
Council 2010).
Logistics management is treated as a part of the supply chain management that deals with
management of goods in an efficient way. It is the management process that integrates the
movement of goods, services, information and capital, right from the sourcing of raw material, to
the consumer (Springinklee and Wallenburg, 2012). According to The Supply Chain
Management Professionals, (2007) logistics management is defined as that part of Supply Chain
Management that plans, implements, and controls the efficient, effectively forward and reverses
the flow and storage of goods, services and related information from the point of origin and the
point of consumption in order to meet customers’ demands. The goal of the logistics
management is to provide the right product with the right quality at the right time in the right
place at the right price to the ultimate customer (Mentzer et al., 2004). Thus, Logistics
management has been defined as a high priority for contemporary organizations. The success of
logistics management is determined through the combination of efficiency, effectiveness and
differentiation (Fugate, B. S., Mentzer, J. T. and Stank, T. P. (2010). Therefore, Logistics
through its activities remains one of the business processes that must be integrated throughout
the supply chain in manufacturing organizations to better serve the ultimate customers while
enhancing the performance of the organization and individual chain supply members (Cohen &
Roussel, 2005).
various empirical studies, such as Ellinger, A.E., Daugherty, P.E. and Keller, S.B. (2000), show
that logistics is a strategic vector in companies’ organization and influences their performance,
namely in terms of service quality and overall profitability. Schramm and Morschett, (2006),
Opines that marketing performance (sales and market share growth) and financial performance
(return on investment and profit growth) are consequences of performance of logistics activities.
It can therefore be argued that logistics activities must be ingrained in organization strategies so
that it can secure high performance. Competitive position of a business mainly results from the
evaluation of what the firm delivers with regards to value creation as compared to what other
competitors offer (Gorynia, 2004) cited in (Olaf & Grrzegorz, 2015 ). According to Nyaberi and
Mwangangi, (2014) in their study on Effects of logistics management practices on performance
of Rift Valley Bottlers Limited in Kenya found that logistics management practices contributes
to increase in profit, sales volume, service delivery, production levels and quality of product
which denotes organizational performance. Thus, the management of logistics activities has
become a valuable way of securing competitive advantage and improving organizational
performance (Li, S., Ragu-Nathan, B., Ragu-Nathan, T. S., and Rao, S. S. (2006)).
By addressing logistics management practices that contribute to customer service performance,

will help the researcher better understand the scope and activities related to logistics
management that create enhanced level of customer service in competitive business marketplace.
Therefore, the purpose of the proposed research will be to empirically test the effect of logistics
management practices on customer service performance of the company.
1.2. Statement of the Problem
In today's highly competitive environment, some companies are aiming to gain global market
share and to obtain a higher output and efficiency of resources. Nowadays, a key determinant of
the performance of business is the role of “logistic function” in ensuring the smooth the flow of
materials, products and information throughout supply chains organizations (Sum et al., 2001).
Due to the high intensity of global competition, the performance of the supply chain through
logistic, is considered increasingly important as a strategic weapon to achieve and maintain
competitive strength.
In the past the goals of logistics were connected primarily to cost effectiveness. Nowadays,
besides cost effectiveness, attention is paid also to fast lead times and developing customer
service. As a result of costs, the price is still an important factor in competition, but in addition
companies want shorten delivery times, increase the speed of distribution and reaction, make
sure that the delivery arrives on time. Logistics is not just “save money” action; it is an important
part of customer oriented service strategy. (Sakki 2003 p.25: cited by Koykka 2010).
Improving logistic performance yields numerous benefits, including greater customer

satisfaction, increased delivery speed, more rapid response to demands, order and delivery
flexibility, and faster order completion capability (Droge et al. 2004). However, optimal logistics
performance implies efficiency and effectiveness of all steps in the supply chain (Gunasekaran &
Kobu 2007, Fugate et al. 2010). Effectiveness is the extent to which a customer’s requirements
are met, whereas efficiency measures how economically a firm’s resources are utilized when
providing a pre-specified level of customer satisfaction (Shepherd & Günter 2006). Customer
satisfaction is a primary measure of business success and is thus significant for evaluating
logistics performance (Stank et al. 2003). Hence, when setting targets for logistics performance,
order fulfillment must be a priority (Croxton 2003). Managers take a decisive role in the creation
of such effectiveness. The role of managers has to be in building dynamic processes, while
maintaining the organization's stability and prosperity, survival and success, in a very complex
network, which are of critical importance to its constituent organizations (Harland et. al. 2000).
Therefore, in logistics management, unwise decisions create multiple issues. Failed or delayed
deliveries lead to buyer dissatisfaction. Damage of goods, due to careless transportation is
another potential issue. Poor logistics planning gradually increases expenses and issues may arise
from implementation of ineffective logistics system. To resolve these issues, organizations
should implement best logistics management practices. Companies should focus on collaboration
rather than competition. Good collaboration among transportation providers, buyers and vendors
helps reduce expenses. Also an efficient and safe transportation provider is vital to business
success. (Jansssen et al., 2010)
Different researches have been done about the impact of logistics activities (practices) on
organizational performance but there has been limited or we can say that no academic effort
about logistics management practices and firm customer service performance specifically. For
instance, Mwangangi (2016) conducted a research on influence of logistics management on
performance of manufacturing firms in Kenya. Findings revealed that transport management;
inventory management; order process management, and information flow influences firm
performance. Ontita (2016) conducted a research on inventory management approaches and
performance of textile manufacturing firms in Kenya. Finding revealed that inventory
management approaches used manufacturing companies include; information technology, lean
inventory system and strategic supplier partnership. It was also revealed that there was a strong
positive correlation between the inventory management practices and operational performance of
the textile manufacturing firms.
Njoroge and Kabare (2016) investigated the role of fleet management on supply chain
performance in logistics firms based in Nairobi Industrial Area, Kenya. It was recommended that
logistic firms should invest heavily in ICT such as; installation of onboard vehicle
communication systems, vehicle safety technology and fleet management systems. Information-
enabled collaboration reduces costs across the chain while enhancing customer service and
value. Advances in information technology have changed modern business practice, making
collaborative supply chain management possible (Chatfield et al, 2004). Information’s
competitive value is widely heralded it substitutes for inventory, speeds new product design,
shortens order fulfillment cycles, drives process reengineering, and coordinates SC activities
(Hult et al., 2004).
Also Musau, Namusonge, Makokha and Ngeno (2017) conducted a research on the effect of
transport management on organizational performance among textile manufacturing firms in
Kenya. It was concluded that transport management influences performance of supply chain. The
study recommended that the organization must come up with new strategies such as; scheduling,
route planning, fleet management, and vehicle tracking. Through this, the organization will be
able to become more competitive. In addition, according to (Sbihi and Eglese, 2010; Genchev et
al., 2011, Bienstock et al., 2008) Customer satisfaction is affected by warehouse and inventory
management solutions and sharing and managing of common Information Communication
Technology (ICT) processes.
Moreover many researchers investigate the impact of Logistics Management Practices either on
organizational performance, operational performance or business performance in general but no
one is investigated on customer service performance partially. Therefore, the proposed paper will
intend to investigate the effect of LMPs on customer service performance of the company (East
African bottling share company - coca cola). Therefore, from empirical evidences the researcher
was taken five LM practices that has a relation to customer service performance to investigate
the effect of LM practices, (Information Flow Management Practices, Transportation
Management Practices, Physical Distribution Management practices, Inventory planning and
Management practices, and Warehouse Management practices) on customer service performance
of the company as it is the main source of companies’ competitive advantage. And also based on
the empirical evidences the researcher has set the following major research questions to be
answered from the proposed research.
1.3. Research Questions:

With reference to the above statements the study will intend to investigate and answer the
following research questions
 What is the effect of Information Flow Management Practices on customer service

performance of EABSC of Ethiopia?
 What is the effect of Transportation Management Practices on customer service
 What is the effect of Physical Distribution Management practices on customer service
 What is the effect of Inventory planning and Management practices on customer service
 What is the effect of Warehouse Management practices on customer service performance
of EABSC of Ethiopia?
1.4. Objectives of the Study
1.4.1. General Objective
The general objective the study is to assess the impact of the logistics management practices on
customer service performance of EABSC Ethiopia, Addis Ababa.
1.4.2. Specific Objectives

In addition to the above main objective the research will intend to investigate the following
specific objectives.
 To examine the effect of Information Flow Management Practices on customer service

performance.
 To assess the effect of Transportation Management Practices on customer service
performance.
 To assess the effect of Physical Distribution Management practices on customer service
performance.
 To evaluate the effect of Inventory planning and Management practices on customer
services performance.
 To ascertain the effect of Warehouse Management practices on customer service
performance.
1.5. Significance of the Study
The proposed study will have significant importance in strengthening the existing knowledge and
understanding of logistics management practices and customer service performance by
examining and empirically testing the relationship between logistics management and customer
service performance for the case of EABSC Ethiopia. The study will also provide some insight
or recommendations to EABSC Ethiopia, Addis Ababa to evaluate and improve their logistics
management practice based on the study findings. Finally, the proposed study can serve as an
additional reference to others researchers who are interested in the area of logistics management
and customer service performance.
1.6. Scope of the study

Logistics management encompasses vast areas of managerial practices. However, it is difficult
and unmanageable to conduct the proposed study in all areas that summarizes Logistics
management in terms of time, finance, and research manageability. Therefore, the scope of the
proposed study will be delimited to an assessment of the impact of Logistics management
practices (Information Flow Management Practices, Transportation Management Practices,
Physical Distribution Management practices, Inventory planning and Management practices, and
Warehouse Management practices) on customer service performance. To manage the research
flow only EABSC Ethiopia, located in Addis Ababa will be subjects of the study, through
assessing how the company interacts with its down streams of the supply chains or customers
(distributors and retailers). The subject scope of this study will be also delimited to the
company’s customers around Addis Ababa.
CHAPTER TWO
REVIEW OF RELATED LITERATURES
2.1. Theoretical Review of Related Literature

2.1.1. Concept of Logistics
Logistics has evolved from a mere classic transport function to a strategic, cross-functional, and
global discipline (Grant et al., 2006). Supplying production material to factories and distributing
finished goods to warehouses and shops are prerequisites of highly fragmented value chains in
global economies today. The increasing impact of logistics on a company’s success and
economic growth underlines the importance of future planning in this field. Supplying the
world’s population with food, daily goods, books, educational material, and medicine has
become one of the key issues in fostering economic prosperity in developing and emerging
countries, especially in rural areas (A. Carallo, 2013).
Additionally, the professionalization of logistics management, as well as the strong conviction

that logistics contributes to economic wealth and costs savings, have changed the way logistics-
related aspects are viewed. Disaster relief, humanitarian aid, and refugee camp supplies are some
important areas which are handled by professional logistics nowadays. Consequently, the overall
importance of logistics is increasing. Thus, innovative and up-to-date methods are needed to
cope with new challenges in the field (Berghaus, 2015).
Since logistics advanced from 1950s, due to the trend of nationalization and globalization in
recent decades, the importance of logistics management has been growing in various areas. For
industries, logistics helps to optimize the existing production and distribution processes based on
the same resources through management techniques for promoting the efficiency and
competitiveness of enterprises (Alessandro Vitale, 2014).
Logistics can be defined as the process of planning, implementing and controlling procedures for
the efficient and effective transportation and storage of goods including services and related
information from the point of origin to the point of consumption for the purpose of conforming
to customer requirements and includes inbound, outbound, internal and external movements
(Lambert & Stock, 2008). It comprises the management of raw materials flow to finished goods
through an organization. Logistics means planning and organizing activities that ensure that
resources are in place so that the process can be effectuated accordingly in efficient and effective
manner (Mellat-Parast and Spillan, 2014). Similarly, According to the Council of Logistics
Management (CLM) “Logistics is the process of planning, implementing and controlling the
efficient and effective flow of goods, services and related information from point of origin to
point of consumption in order to meet customer requirements”.
It is also defined as part of supply chain that plans, implements, controls the efficient and
effective forward and reverse flow, storage of goods, services and related information between
the points of origin and the point of consumption in order to meet customer’s requirement
(Vitasek, 2007). Logistics activities and processes are fundamental elements that a company’s
supply chain capabilities and competences are based upon. The close relationship between
logistics and customer service, and its effect on a firm’s competitiveness dictate that companies
handle their logistics function prudently so as to achieve its full potential as a source of
competitive advantage. The main functions of logistics managers involve organizing and
planning of inventory, purchasing, transportation, warehousing activities. The logistic activities
can be divided in two categories (Lambert and Burduroglo, 2000):
 Inbound Logistics, that refers to the activities connected with the procurement of
material, handling, storage and transportation; and
 Outbound Logistics, that refers to the activities connected with the collection,
maintenance and distribution or delivery of the product to the final consumer.
Logistics is the responsibility to design and administer systems to control movement and
positioning of raw materials, work-in process, and finished inventories at the minimum total cost
(Bowersox, Closs, & Cooper, 2007). Thus, Logistics encompasses all of the information and
material flows throughout an organization. It includes everything from the movement of a
product or from a service that needs to be rendered, through to the management of incoming raw
materials, production, the storing of finished goods, its delivery to the customer and after-sales
service‖ (Ittmenn & King, 2010).
To conclude, the commonality of the recent definitions in logistics is that, it is a process of

moving and handling goods and materials, from the beginning to the end of the production, sale
process and waste disposal, to satisfy customers and add business competitiveness (Tseng, Yue,
& Taylor, 2005). It is the process of anticipating customer needs and wants; acquiring the capital,
materials, people, technologies, and information necessary to meet those needs and wants;
optimizing the goods or service-providing network to fulfill customer requests; and utilizing the
network to fulfill customer requests in a timely way (Tseng, Yue, & Taylor, 2005).
The role logistics system can play also in reducing the environmental impact of industries has
not been extensively researched. It is especially important to understand the relationship between
operational effectiveness and environmental aspects. Both result from a number of decisions
taken within the firm concerning both strategic and operative levels (Aronsson and Huge Brodin,
2006). Moreover, Logistics purposes may lead to increased levels of performance for the
adopting firm and that complimentary firm resources may affect the degree of performance
(Hazen and Byrd, 2012).
Logistics generates value through the accommodation of clients’ delivery requests. Thus,
logistics performance should indicate the organization’s ability to deliver goods and services
when required at acceptable cost in the quantities required by customers (Zelbst et al., 2008).
Logistics performance can be viewed as a subset of the broader concept of organizational output
(Duong and Paché, 2016). The most traditional logistics performance is based on the creation of
time and place utility, while the attributes of an organization’s product or service offering that
lead to utility creation through logistics activities, which are reflected in seven-R formula. It
refers to the organization’s ability to deliver the right amount of the right product at the right
place at the right time in the right condition at the right price with the right information (Lee et
al., 2016).
Logistics performance is defined as the degree of efficiency, effectiveness, and differentiation

linked with the accomplishment of logistics activities (Mentzer et al., 2004). The logistics
function as a whole should strive to reduce the ratio of resources utilized against derived results
(efficiency), accomplish pre-defined goals (effectiveness), and gain superiority in comparison
with competitors (differentiation) (Tuan, 2017).
Accordingly, logistics is strategically important in many industries as it is central to achieving

competitive advantage (Kenyon and Meixell, 2007). However, companies must respond to
changing customer needs, and logistics flexibility is an important part of the response (Zhang et
al., 2005). Each company must develop or create its own logistical values that will be
incorporated into the product, or its value in use. For customers despite the shape of the product,
it is important that it will be accessible to them in the required time. There are six reverse
logistics capabilities that have impact on companies’ performance: logistics information
management, close-loop capability, supply chain integration, supply chain coordination,
conformity capability, and institutional incentives (Vlachos, 2016).
To conclude, in the past the goals of logistics were connected primarily to cost effectiveness.
Nowadays, besides cost effectiveness, attention is paid also to fast lead times and developing
customer service. As a result of costs, the price is still an important factor in competition, but in
addition companies want shorten delivery times, increase the speed of distribution and reaction,
make sure that the delivery arrives on time. Logistics is not just “save money” action; it is an
important part of customer oriented service strategy. (Sakki 2003 p.25: cited by Koykka 2010).
2.1.2. Logistics Management

Logistics management is treated as a part of the supply chain management that deals with
management of goods in an efficient way. It is the management process that integrates the
movement of goods, services, information and capital, right from the sourcing of raw material, to
the consumer (Springinklee and Wallenburg, 2012). Accordingly, The Supply Chain
Management Professionals, (2007) defined logistics management as that part of Supply Chain
Management that plans, implements, and controls the efficient, effectively forward and reverses
the flow and storage of goods, services and related information from the point of origin and the
point of consumption in order to meet customers’ demands. The fact that logistics is a unifying
link intra organizationally between the production and marketing function and inter
organizationally between suppliers and customers cannot be gain said (Green, Whitten, &
Anthony, 2008).Autry, Zacharia, and Lamb, (2008) contends that logistics must focus on the
coordination, collaboration of activities, logistics social responsibility, and strategic distribution
planning, technology and information systems. These altogether are the fulcrum of customer-
firm-supplier relationship management which improves customer satisfaction and operational
performance and in consequence impacts on organization performance.
In addition, Logistics management is the process of strategically managing the procurement,

movement and storage of materials, parts and finished inventory (and the related information
flows) through the organization and its marketing channels in such a way that current and future
profitability are maximized through the cost-effective fulfillment of orders (Christopher,
Logistics & Supply Chain Management, 2011). Therefore, the logistics management process
begins with raw material accumulation to the final stage of delivering goods to the destination.
By adhering to customer needs and industry standards, logistics management facilitates process
strategy, planning and implementation. Logistics management needs new pattern of thinking
based on entropic thinking and nonlinear thinking which bring together the capacity of
developing strategies and approaching complex problems (Bolisani and Bratianu, 2017;
Bratianu, 2007).
Logistics Management has the mission of getting the right goods or services to the right place, at
the right time, and in the desired condition at the lowest cost and highest return on investment
but with real satisfaction of customers. Logistics has become a part of a company’s strategic
planning, management and controlling. Every company must develop their strategy and logistics
competitiveness factors from their own point of view Haapanen 2005 p15 (cited by Koykka
2010). Therefore, The goal of the logistics management is to provide the right product with the
right quality at the right time in the right place at the right price to the ultimate customer
(Mentzer et al., 2004). Thus, Logistics management has been defined as a high priority for
contemporary organizations. The success of logistics management is determined through the
combination of efficiency, effectiveness and differentiation (Fugate et al., 2010). Eventually,
supply chain management measures through procrastination affect price/cost, product’s quality,
innovation (Mamad & Chahdi, 2013).
2.1.3. Logistics Management Practices

Manufacturing companies are constantly faced with the challenges of keeping track of inventory
and ensuring that their products are successfully delivered to the customers. This workflow
generally involves various forms of logistics, each of which functions a little differently. The
various forms of Logistics Management according to (Ristovska, Kozuharov, & Petkovski, 2017)
are:
2.1.3.1. Information Flow Management

According to Harisson and van Hoell (2002) information flow was defined as the flow of data in
different directions with variable contents between various data base (department) within a
company. Before, the information flow within the logistics had become vital since it enabled
chains to respond on real time and accurate data (Harisson& van Hoell, 2008). Firms then,
looked at information flow as an asset, since it was not possible to have efficient and reliable
materials flow without it ( (Mattsson & Lemmink, 2002) (Stevenson & Spring, 2009) concurred
that, the flow of accurate and real time information in logistics was considered very important to
the flow of materials.
Bowersox, Closs, & Cooper, (2010) named four reasons why timely and accurate information
flow had become more critical for effective logistics systems' design and operations: Customers
perceived information about order status, product availability, delivery schedule, shipment
tracking, and invoices as necessary elements of total customer service. With the goal of reducing
total supply chain assets, managers realized that information could be used to reduce inventory
and human resource requirements; Information flow increased flexibility with regard to how,
when, and where resources may be utilized to gain strategic advantage; Enhanced information
transfer and exchange capability utilizing the internet was changing between buyers and sellers
and redefining the channel relationships (Somuyiwa & Adewoye, 2010).
This information explosion had enabled logistics to become an important weapon in the firm's
arsenal to add value to the bottom line (Closs, et al., 2005). Information sharing was a key to
success of logistics performance (Whipple, Lambert, Vermeersch., 2002). Sharing of information
on transfer; exchange of information indicating the level and position of inventory; sales data and
information on the forecasting; information about the status of orders, production schedules and
delivery capacity, and firm performance measures had become essential to all firms (Wardaya, et
al., 2013). Product and delivery lead times are shortened making products available on time to
customers (Tachizawa and Ginemez, 2005).Access to information enables channel members to
plan how much to stock for a given period of time (Fasanghari, Roudsari and Kamal, 2008). In
order for information sharing to take place, chain partners should have a collaborative potential
and IT infrastructure (Shore and Venkatachalam, 2003).
However, this information flow can only be successful when firms impress on information
technology use. Information technology provides the capacity to see data that is private in a
system of cooperation and monitor the development of products, where information is passing in
every process in the supply chain (Simatupang & Sridharan, 2002).
2.1.3.2. Transport Management
Transportation can be defined as the act of moving goods or people from an origin to a required
destination. It also includes the creation of time and place utilities. Transportation plays a key
role in the supply chain, because without the efficient movement of finished goods and raw
materials the entire system would not be able to work at its full potential (Randall et al., 2010).
Transportation plays a key role in the supply chain, because without the efficient movement of
finished goods and raw materials the entire system would not be able to work at its full potential
(Green, Whitten, & Anthony, 2008). The modes of transportation can be divided into five: rail,
road, air, water and pipeline. Intermodal freight transport involves the transportation of freight in
an intermodal container or vehicle, using multiple modes of transportation (rail, ship, air, water
and truck), without any handling of the freight itself when changing modes. The method reduces
cargo handling, and so improves security, reduces damages and losses, and allows freight to be
transported faster (Cavinato et al., 2007).The goal for any business owner is to minimize
transportation costs while also meeting demand for products.
Transport management is the planning, controlling and decision making on operational area of
logistics that geographically moved and positioned inventory (Bowersox, Closs, & Cooper,
2010). Because of its fundamental importance and visible cost, transportation had traditionally
received considerable managerial attention and almost all enterprises, big and small, had
managers responsible for transportation (Bowersox, et al., 2010). Transportation occupied one-
third to two thirds of the amount in the logistics costs hence transport management influenced
the performance of logistics system immensely (Bowersox, et al., 2010). Transporting is required
in the whole production procedures, from manufacturing to delivery to the final consumers and
returns. Only a good management and coordination between each component would bring the
benefits of logistics to a maximum. A good transport management in logistics activities could
provide better logistics efficiency, reduce operation cost, and promote service quality on firms
(Bowersox, et al., 2010).
From the logistical system point of view, three factors were fundamental to transportation
performance: cost, speed, and consistency (Bowersox, et al., 2010). The cost of transport is the
payment for shipment between two geographical locations and the expenses related to
maintaining on-transit inventory. Logistical systems utilized transportation that minimized total
system cost (Bowersox, et al., 2010). According to Bowersox, (2010) speed of transportation
was the time required to complete a specific movement. Speed and cost of transportation were
related in two ways. First, transport firms capable of offering faster delivery typically charged
higher rates for their services. Second, the faster the transportation service was, the shorter the
time interval during which inventory were on transit and the higher the charges (Bowersox, et al.,
2010). Thus, a critical aspect of selecting the most desirable method of transportation to a firm is
to balance speed and cost of service.
2.1.3.3. Physical Distribution

Distribution is an integral part of the marketing mix. With the right distribution strategy in place
that is with the right mode of delivery the right speed of delivery to the appropriate place of
purchase, customer satisfaction can be significantly increased. Failure to deliver these practical
points will result in the loss of orders and income to the company and long-term customer loyalty
will decline (Drummond and Ensor 2001).
Physical distribution is a whole process that concern also materials and finished product, a
physical movement of goods from the manufacturers to intermediaries and finally to the ultimate
consumer. Distribution accomplishes this by providing time and place utility, in other words,
availability and its goals are like any other marketing goals: consumer’s satisfaction and profit
for the firms (Muhscina, 2008). There are various routes that products or services use after their
production until they are purchased and used by end users. These channels are referred to as
distribution channels or marketing channels. Therefore, distribution channels are all those
organizations that a product has to go through between its production and consumption (Kotler et
al, 2006). Distribution channel management is very critical for the firms when they decide to
enter one or more markets.
Figure 2.1: Major Channels of Distribution
Source: Etzel et al. (2004)
There are 3 degrees of intensity of distribution namely; selective, intensive and exclusive
distributions with their application relying on the nature of the product and market type (Etzel et
al, 2004).
According to (Etzel et al, 2004), A firm with intensive distribution policy seeks to achieve a wide
distribution for its products. This in essence means that the firm will make use of as many outlets
as possible perhaps a combination of both direct and indirect methods of distribution are likely to
be out into use. Such intensive distribution aims the product at the mass marketing and the
distribution strategies implemented tend to carry the product to all the nooks and corners of the
market. With selective distribution however, not every outlet or channel will be utilized. The
firm will rather rely on a few outlets to handle the products. The firm may resort to this method if
the product involved is of a durable nature and requires an after-sales service or it is associated
with certain prestige. Exclusive distribution entails the granting of exclusive rights to a single
seller in with a particular territory or area to sell the company’s products such a right therefore
provides that the firm supplies all the necessary tools including promotional device to the seller.
The seller in turn undertaken to handle only the Firm’s middlemen all stand to gain from such
arrangement. The middlemen get larger commission because his mark-up is high; he also
commands the prestige of such a role. The firm on the other hand, is free from the burden of
having to handle completely the marketing of its products and it is in the better position to fight
off competition.
2.1.3.4. Inventory Planning and Management

The overall objective of Inventory Planning and Management is to determine and maintain the
lowest inventory levels possible that will meet the customer service policy requirements
stipulated in the CSP. Inventory is the stock of any item or resource used in the organization. An
inventory system is the set of policies and controls that monitor levels of inventory and
determine what levels should be maintained, when stock should be replenished, and how large
orders should be. Inventory control is the supply of goods and offerings at the proper time with
the right time and amount (Ogbo, 2011). Adeyemi and Salami (2010) state that the main purpose
of inventory management is to have what is needed, and to reduce the quantity of instances
production and services operations are interrupted by using issues of stock outages. According to
Vergin (2012), organizations use inventory management practices such as automatic
replenishment, ABC inventory model, just-in time (JIT) inventory, economic order quantity
(EOQ) and vendor managed inventory. In addition, the use of inventory management has also
helped organizations become competitive in the market. Use of information technology to
manage inventory enables an organization to become more efficiency and cut cost (Kithinji,
2015).
Therefore, Inventory management is a strategic area in logistics operation and has an impact of
efficiency and effectiveness of the overall supply chain system. Whilst inventories provide some
security against fluctuations in the level of customer demand, there is concern that they may
reduce the ability of supply chains to respond to changes in the nature of demand. Inventories in
the international supply chains may therefore act as a buffer against one risk whilst increasing
another type of risk. Etienne (2005) lists factors such as speed to the market for new products,
responsiveness to market niches, and feedback time for quality issues. Harrison and Van (2008)
have put forward inventory reduction strategies such as: reduction of production lead times,
product postponement, total cycle time, compression, centralization of inventory and the virtual
warehousing concept. Managing all kinds of assets in an organization can be viewed as an
inventory problem.
Successful inventory management involves creating a purchasing plan that will ensure that items
are available when they are needed (but that neither too much nor too little is purchased) and
keeping track of existing inventory and its use. Two common inventory-management strategies
are the just-in-time method, where companies plan to receive items as they are needed rather
than maintaining high inventory levels, and materials requirement planning, which schedules
material deliveries based on sales forecasts, Christopher 2007.
2.1.3.5. Warehousing Management

A warehouse is a commercial building for buffering and storage of goods or an intermediate area
for storing of raw materials or products until they are needed for production or consumption
Chua and Teo 2008 (cited by Haung Min study 2010). Warehousing refers to the activities
involving storage of goods on a large-scale in a systematic and orderly manner and making them
available conveniently when needed. In other words, warehousing means holding or preserving
goods in huge quantities from the time of their purchase or production till their actual use or sale.
Being an essential component of logistics, is a key aspect of modern supply chains and plays a
critical role in the success or failure of business today Frazelle 2002a. (Cited by Haung Min
study 2010)
According to Tompkins et al., (2003) the typical warehouse functional areas and flows as;
receiving, staging for cross-docking, reserve, forward and shipping. Receiving, transfer and put
away, order picking, cross-docking, and shipping. Order picking is the most labor-intensive and
costly activity of most warehouses. The most common order picking system is picker-to-parts
systems, in which the order pickers walks or drives along the aisle to pick items (De Koster
(2004). Therefore, Warehousing is an important part of a firm’s logistics system that stores
products (raw materials, parts, goods-in-process and finished goods) at and between points of
origin and points of consumption. Warehousing can be provided by either warehouses or
distribution centers (Murphy & Wood, 2008).
Warehouse layout is also important in achieve greater efficiencies. Minimizing travel time
between picking locations can greatly improve productivity. However, to achieve this increase in
efficiency, companies must develop processes to regularly monitor picking travel times and
storage locations. Warehouse layout is one important factor affecting the order picking process.
An important decision for many firms is the criteria for locating the warehouse facilities. Cost
factors are prevalent in the decision making models. Resources such as skilled labor are also
emphasized in some of the models. Another dominant factor is what might be named as
accessibility, meaning infrastructure and availability of transportation modes (Melachrinoudis, et
al, 2000). Alberto (2000) also emphasizes time and reliability related considerations. This
includes the proximity of customers manufacturing facilities and suppliers.
2.1.4. Customer Service

According to Stock and Lambert (2001:97), customer service can be defined as a process which
takes place between buyer, seller and the third party. The process results in a value added to the
product or service exchanged. This value added in the exchange process might be short term as
in a single transaction or longer term as in a contractual relationship. The value added is also
shared, in that each of the parties to the transaction or contract is better off at the completion of
the transaction than they were before the transaction took place. Thus, in a process view:
customer service is a process for providing significant value-added benefit to the supply chain in
a cost-effective way. Doctker (in Ballou 2004:93), considering customer service in terms of a
fulfillment process, define it as ‘… the entire process of filling the customer’s order. This
process includes the receipt of the order (either manual or electronic), managing the payment,
picking and packing the goods, shipping the package, delivering the package, providing to the
customer for the end user and handling the possible return of the goods.’
Finally, Emerson and Grimm (in Collins, Henchion and O’Reilly 2001:2) distinguish between
marketing and logistics customer service, both of which are required to meet customer
expectations.
They describe logistics customer service activities as providing ‘place, time and form utility, by
ensuring that the product is at the right place, at the time the customer wants it and in an
undamaged condition.’ Its activities are restricted to those that take place during the individual
order cycle, from order placement to order delivery.
Marketing customer services, on the other hand, are those outside the context of the order cycle.
They ‘facilitate possession utility by creating awareness of the product, offering a mechanism
such as price, by which the buyer-seller exchange can take place, and often offering follow-up
service and warranty on the product.
The purpose of the logistic system is to serve customers as well or better than the competition
and at the same time to make profits. Customer service is the chain of sales activities and
meeting customer requirements, which begins with receiving the orders and ends with the
delivery of the products to customers, in some cases continuing with equipment maintenance
services. (Bălan Carmen, 2001) The role of customer service is to provide time and place utilities
in the transfer of goods and services between the manufacturer and the customer. In another
form, the product has no value until it is in the hands of the customer (Martin Christopher, 2007).
Availability is a complex concept, influenced by many factors that together form the customer
service. These factors include the frequency of the delivery and its safety, the stock level and the
time interval the order is released.
The logistic system involves the connection between the business and its customers for the
procurement and stockpiling of materials, the implementation and the physical distribution of
products, so that the firm manages to meet customer requirements. The logistic system provides
an overview of the movement of goods and services from the supplier to the end user and the
movement of payments and information in reverse sense. Between the business and the
customers there are close relationships that allow identifying the benefits from the strategic point
of view of the system functionality. The management’s attention should focus not only on the
business, but also on the interactions giving logistical system functionality. Today we are
witnessing the increasing importance of consumer services, which become a competitive weapon
of the organization. The factors behind this growth are (Martin Christopher, 2007): the
continuous changes in the customer expectations, the consumer demands more, he is more
sophisticated than he was 30 years ago. The reduction in the power of the brand growth by the
technologies of the competitive products: thus making difficult to perceive the differences
between products. The specialized literature identified three components of customer service
(Martin Christopher, 2007):
Pre-transactional elements that create a favorable climate for customer service: the customer
service policies and programs, the organizational structure necessary to implement the customer
service policy, the flexibility of the system or its ability to respond to customer needs.
Transactional elements established by meeting the logistic function: the availability of the
product in the stock, information about the order, the order cycle duration.
Post-transactional elements of customer service are generally those that support the product in
use: product guarantee, maintenance service, product replacement, client complaint resolution,
and product reimbursement. It is very difficult for any company to identify its customers' needs.
The relationship between logistics and customer service requires the company to choose one of
the two fundamental strategic options (Porter Michael E, 2001):
A leadership position in pricing, which means that the firm should be the manufacturer with
the lowest cost in the area in which it operates;
A significant differentiation, which consists in visible differences against the competitors
clients are interested in (superiority of the product, delivery in the shortest time and safely,
quality service).
Logistics favors holding cost advantages and contributes to differentiate services. Linking
logistical activities and conducting cost reductions permit the establishment of more competitive
prices. The competitive advantage can also be achieved by providing qualitative services.
2.2. Empirical Review of Related Literature
2.2.1. The Impact of LMPs on Customer Service Performance
Mwangangi (2016) conducted a research on influence of logistics management on performance
of manufacturing firms in Kenya. Findings revealed that transport management; inventory
management; order process management, and information flow influences firm performance.
Nuahn (2017) investigated the impact of logistics and transportation practices on performance of
Kenya Cooperative Creameries. The findings revealed that there exists а strong positive
relationship between transportation and performance at KCC.
Musau, Namusonge, Makokha and Ngeno (2017) conducted a research on the effect of transport
management on organizational performance among textile manufacturing firms in Kenya. Target
population was 169 employees. Stratified and simple random sampling methods were used to
select а sample of 139 employees. It was concluded that transport management influences
performance of supply chain. The study recommended that the organization must come up with
new strategies such as; scheduling, route planning, fleet management, and vehicle tracking.
Through this, the organization will be able to become more competitive.
Kimulu (2014) conducted a research on logistics outsourcing and performance of commercial

banks in Kenya. Target population was 43 commercial banks in Kenya. The study conducted а
census. Primary data was collected using standard questionnaire. The findings revealed that route
optimization had been achieved and fleet tracking tools increased vehicle visibility to large
extent while vehicle scheduling improved to a moderate extent. Njoroge and Kabare (2016)
investigated the role of fleet management on supply chain performance in logistics firms based in
Nairobi Industrial Area, Kenya. Cross sectional survey research design was used. The study
targeted 20 logistics firms in the industrial area. Simple random sampling was used to select 65
respondents. It was recommended that logistic firms should invest heavily in ICT such as;
installation of onboard vehicle communication systems, vehicle safety technology and fleet
management systems.
Ontita (2016) conducted a research on inventory management approaches and performance of

textile manufacturing firms in Kenya. Finding revealed that inventory management approaches
used manufacturing companies include; information technology, lean inventory system and
strategic supplier partnership. It was also revealed that there was a strong positive correlation
between the inventory management practices and operational performance of the textile
manufacturing firms. According to Womack and Jones (2003), lean inventory system is the
process of reduced level of inventories. Brigham and Gapenski, (2013) posit that reducing the
level of inventory will enable organizations get higher profits. This is because the organization
will be able to reduce storage cost, handling cost and waste. Eroglu and Hofer (2011) conducted
a research on lean, leaner, too lean? Inventory-Performance Link Revisited. Findings revealed
that inventory management has а significant and positive influence on performance of
companies.
Fugate, Mentzer and Stank (2010) conducted a study on logistics performance and its influence
on firm performance in USA on 150 firms. The study revealed that increase in logistics
efficiency, effectiveness, and differentiation decreased expenses, inventory, cash requirements
and increased inventory availability, timely delivery, on-time and damage-free deliveries, line-
item fill rates and sales which improved net margin and asset turnover, which improved return on
assets and overall firm performance.
Liu and Luo, (2008) examined the effect of logistics capabilities on performance in
manufacturing firms in China. The study based on a survey of 1000 manufacturing firms in
central south, south and central china regions. By exploratory and confirmatory factor analyses,
the scale of manufacturing firm’s logistics capabilities is obtained. The results show that logistics
capabilities can be conceptualized as a three dimensional construct: process capability, flexibility
capability and information integration capability.
Mansidão and Coelho, 2014:4 conducted an empirical analysis on data obtained by mail survey
from executives to define and further measure performance with respect to logistics that resulted
in identifying length of promised order cycle times for base-line/in-stock products,
manufacturer’s performance in meeting promised delivery dates, fill rate on base-line/in-stock
items, advance notice on shipping delays, accuracy of manufacturer in forecasting and
committing to estimated shipping dates on contract/project orders, manufacturer's adherence to
special shipping instructions, accuracy in filling orders as appropriate measures for logistical
performance. The study basically dealt with soft measures of logistics performance that can be
characterized with their focus on customer satisfaction. In light of a perspective that dictates the
very existence of an ideal logistics service is for identifying the requirement of the customer it
serves and ultimately ensuring an excelled customer satisfaction, the attention given to such
measures that align with logistics customer service is appropriate and is believed to be highly
applicable in a pragmatic manner for an ideal manufacturing business entities. In other words,
such soft measures have a significance importance in capturing the logistical performance
aspects of firms.
Srivastava (2006) investigated the state of logistics and supply chain practices in India. He found
that, while Indian managers are well aware of the need to develop supplier partnerships, integrate
and coordinate the flow of goods from supplier’s supplier to ultimate customer, and share
information among supply chain partners, the infrastructure necessary to facilitate such seamless
integration is as yet unavailable. There is pressure in emerging markets to rapidly adopt logistics
and supply chain integration practices in an effort to compete globally.
Fugate, Mentzer and Stank (2010) conducted a study on logistics performance and its influence
on firm performance in USA on 150 firms. The study revealed that increase in logistics
efficiency, effectiveness, and differentiation decreased expenses, inventory, cash requirements
and increased inventory availability, timely delivery, on-time and damage-free deliveries, line-
item fill rates and sales which improved net margin and asset turnover, which improved return on
assets and overall firm performance.
Hyvönen (2007) conducted a study on the logistics in Finland firms. Descriptive statistics was
used in data collection and analysis. The findings of the study were that when information
technology is applied to logistics management, it resulted in increased sales and customer
satisfaction. The study however, was not able to establish the influence the other aspects of
logistic management had on performance other than information technology.
Bwari et al. (2016) conducted a study on supply chain in East African Breweries Limited. The
study adopted descriptive research design. The study targeted all the 1653 employees in EABL.
From each stratum, the study took a 10% sample to give a sample size of 165 respondents. The
study found out that inventory control, distribution management, transportation management
influenced supply chain performance to a great extent but warehousing management services
influenced supply chain performance to a moderate extent. The study however did not
investigate the relationship that existed between the research variables.
Wathe (2016) investigated the influence of logistics being the independent variables, on the
performance of manufacturing firms being the dependent variable. The study used both
descriptive and explanatory research designs. A semi-structured questionnaire was administered
through e-mail survey and hand delivery. The study found out there is a positive relationship
between logistics and the performance of manufacturing companies in Kenya.
Sezen (2005:351) argued that logistics performance can be evaluated by considering logistics
costs, customer satisfaction, product availability in the market, conforming to the promised
delivery dates and quantities, flexibility in all logistics activities, and efficiency in inventory
management. Besides, Fugate et. al (2010:14) were conceptualizing logistics performance as
multidimensional construct that consisted of logistics differentiation, logistics efficiency and
logistics effectiveness. To put it in other words, it seems that the most holistic study that
objectively accounted the vital aspects of logistics performance is that made by Fugate et. al
(2010) where the authors constructed logistics performance in terms of the dimensions of
logistics effectiveness, logistics efficiency and logistics differentiation.
2.3. Conceptual Framework of the Study
The conceptual framework shown in Figure 2.2 is developed based on the literature review. The
conceptual framework will illustrate the linkage between Logistics management practices and
customer services performance.
Independent Variables Dependant Variables
Logistics Management Practices
Information Flow Management
Transportation Management
Physical Distribution Management Customer

service
Inventory Planning & Management performance
Warehouse Management
Figure 2.2.shows the relationship between independent and dependant variables
Source: (compiled by the researcher, 2020)

As it is observed on the literature above Information flow management (coordination,
communication, controlling monitoring and planning logistics processes through ICT),
Transportation management (enabling timely delivery of products & services, using electronic
system to track all transported products, availability of products at customer desire location),
Distribution management (label and load the right product to the right vehicle and etc), Inventory
management (avoiding inventory bottlenecks, keeping cost at minimum, using right inventory
management techniques like ABC, JIT etc), ware house management practices (product delivery
in the right quantity, product leave the ware house clean and damage free for customers and
warehouse location convenient to customers) of the company are practices that is required to
deliver customer requirements. Which in turn all are requirements to improve customer service
performance in terms of lead time, timely delivery of orders, responsiveness and time to market
performance and flexibility.
CHAPTER THREE
RESEARCH DESIGN AND METHODOLOGY
3.1. Research Approach

The proposed Research will intend to use qualitative research approach through structured
questionnaires with closed Likert type statement; it is a means for testing objective theories by
examining the relationship among variables. These variables, in turn, will be measured, typically
on instruments, so that numbered data will be analyzed using statistical procedures.
3.2. Research Design

The proposed study will adopt empirical investigation with descriptive and explanatory research
design, since the major focus of the proposed research is to investigate the impact of logistics
management practices on EABSC Ethiopia customer service performance. Explanatory studies
and descriptive survey designs will be used to allow for the gathering of information, summarize,
present and interpret it for the purpose of clarification (Creswell, (2003). Therefore, in order to
accurately describe the effect & relationships between the independent variables and the
dependent variable descriptive and explanatory research studies will be employed which helps to
use both qualitative and quantitative data analysis.
3.3. Types and Sources of Data

Primary and secondary data will be collected from both primary and secondary sources through
Questionnaires in order to improve the accuracy and to reduce the bias. The questionnaires will
be distributed to employees of the company and distributers of the company. As the secondary
data; books, articles, journals, are reviewed to develop conceptual framework.
3.4. Population
The target population of the study will be 1314. From total target population 1,152 are
employees of EABSC Ethiopia located at Addis Ababa and 162 distributers from Addis Ababa
area.
3.5. Sample size determination
Since the total numbers of employees of EABSC Ethiopia located at Addis Ababa and
distributers from Addis Ababa area are 1314. The researcher used Yamane’ (1967) formula to
calculate sample size.
N
n=
1+ N (e) ²
Where n is the sample size, N is the population size, and e is the level of precision. By using this
formula at 95% confidence level and 5% level of precision the sample size were obtained as
follows:
1314
n= =306
1+1314 (0.05) ²
From the total target population 306 will be considered as sample size of the study excluding
secretaries, guards, other supportive staffs whom they are insignificant for the study and, through
considering the heterogeneity of sample respondents on the basis of different units/ departments
within the organization.
3.6. Sampling Techniques

For the purpose the of proposed study, the researcher will intend to use non probability sampling
technique since the total population of the study is large and heterogeneous in type purposive and
convenience sampling technique will be preferred. Therefore, the information required for the
proposed study involves selection of respondents who have enough awareness about the
company’s logistics management practices and customer service performance; purposive and
convenience sampling technique will used to have the right peoples from every concerned
section in the company and its downstream supply chain. In this case respondents from Logistics
and supply chain management, operation (production), marketing and sales department of
EABSC Ethiopia and Logistics, marketing and sales departments from distributors and retailers
will be considered in the sample.
3.7. Data Collection Instruments

The data will be collected through structured questionnaires with closed Likert type statements
questions. The Likert type scale, commonly used in business research will be applied because it
allows participants to provide their perceptions and opinions both in terms of direction (positive
or negative) and intensity (degree of agreement or disagreement). The questionnaire will utilize a
five point likert scale namely Strongly disagree (SD), Disagree (D), Neutral (N), Agree (A) and
Strongly Agree (SA) which will be assigned scores of between 1 and 5. This will allow the
researcher to draw conclusions based on responses made from the respondents.
3.8. Method of data analysis
The collected data will be analyzed through Descriptive, Regression analysis and correlation
analysis. Descriptive analytical technique will be used with the aid of Statistical Package for
Social Sciences (SPSS) version 25. The reliability of the variables will be measured by Cronbach
alpha. And also, the collected data will be analyzed by Regression analysis and correlation
analysis because it helps to investigate the relationship between the independent variable of
logistics management practice and customer service performance and its impact on the
dependent variables customer service performance. The proposed study will also use tables,
frequencies, and percentages to analyze and present the collected data.
3.9. Ethical Consideration

A formal letter will be written from Unity University Adama campus, Department of Business
Administration to EABSC Ethiopia located at Addis Ababa and distributers retailers around
Addis Ababa. The data collection will start after getting consent from the parties mentioned
above. In addition to this, name of the employees (selected for the sample) will not be included
to maintain confidentiality.
4. Time and Budget Schedule
4.1. Time Schedule
S.No Activities Duration
1 Proposal development and defense Week one , week two
2 Data collection Week three, four, five
3 Data analysis Week six, seven, and nine
4 Writing thesis submitting to advisor Week ten and eleven
5 Writing final thesis Week twelve and week thirtieth
6 Thesis defense Week fourth
The above table (activities) will be conducted from march/2020 to July 2020.
4.2. Budget Schedule

Transport Expense
Number of
S.No Traveler Departure Destination Cost/Trip Total
trips
1 Student adama Adis ababa 10 300 3000
Miscellaneous Expense
S.No Purpose Cost

1 Photocopy service 3500
2 Thesis binding 1200
3 Internet service and others 2100
4 Restaurant (Cafe) 1000
5 Stationary materials 4300
Total 0
Budget Summary
S.No Description Subtotal Expense

1 Transport 3000
2 Miscellaneous Expense 12100
3 Total 0
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EFFECT OF LOGISTICS MANAGEMENT PRACTICES ON

CUSTOMER SERVICE PERFORMANCE OF EABSC ETHIOPIA

UNITY UNIVERSITY ADAMA CAMPUS

A Thesis Submitted to Department of Business Management in

Advisor: Bekele Reta (Asst. Prof)

FACULTY OF BUSINESS AND SOCIAL SCIENCES

DEPARTMENT OF BUSINESS MANAGEMENT

EFFECT OF LOGISTICS MANAGEMENT PRACTICES ON

CUSTOMER SERVICE PERFORMANCE OF EABSC ETHIOPIA

(COCA-COLA PLC) ADDIS ABABA:

Prepared by: Betelhem Mamush

Approved By a Board of Examiners

___________________ _____________ __________

Chair Person Signature Date

___________________ _____________ _________

Internal Examiner Signature Date

___________________ _____________ _________

External Examiner Signature Date

Name: Betelhem Mamush

Bekele Reta (Asst.pro.)

Key word: Logistics, Logistics Management Practices, customer Service Performance

1.1. Background of the study

By addressing logistics management practices that contribute to customer service performance,

1.2. Statement of the Problem

Improving logistic performance yields numerous benefits, including greater customer

1.3. Research Questions:

 What is the effect of Information Flow Management Practices on customer service

1.4.2. Specific Objectives

 To examine the effect of Information Flow Management Practices on customer service

1.6. Scope of the study

2.1. Theoretical Review of Related Literature

Additionally, the professionalization of logistics management, as well as the strong conviction

To conclude, the commonality of the recent definitions in logistics is that, it is a process of

Logistics performance is defined as the degree of efficiency, effectiveness, and differentiation

Accordingly, logistics is strategically important in many industries as it is central to achieving

2.1.2. Logistics Management

In addition, Logistics management is the process of strategically managing the procurement,

2.1.3. Logistics Management Practices

2.1.3.1. Information Flow Management

2.1.3.3. Physical Distribution

2.1.3.4. Inventory Planning and Management

2.1.3.5. Warehousing Management

2.1.4. Customer Service

Kimulu (2014) conducted a research on logistics outsourcing and performance of commercial

Ontita (2016) conducted a research on inventory management approaches and performance of

Independent Variables Dependant Variables

Logistics Management Practices

Information Flow Management

Physical Distribution Management Customer

Figure 2.2.shows the relationship between independent and dependant variables

Source: (compiled by the researcher, 2020)

3.1. Research Approach

3.2. Research Design

3.3. Types and Sources of Data

3.6. Sampling Techniques

3.7. Data Collection Instruments

3.8. Method of data analysis

3.9. Ethical Consideration

_____________ _ ____

_____________ _ ___

_____________ _ ___