The Impact of Third Party Logistics Activities on Supply Chain Performance in Flour Mills of Nigeria PLC, Lagos

M.O. Gbededo (), T.O. Salaam () and R.O. Olorunnimbe ()

American Journal of Supply Chain Management, 2024, vol. 9, issue 3, 1 - 15

Abstract: Purpose: The aim of the study was to investigate the impact of Third Party Logistics (3PLs) activities on supply chain performance in Flour Mills of Nigeria (FMN) Plc, Lagos. Materials and Methods: A descriptive research design with a target population of 350 consisting of men and women in various departments (top management, Logistics/warehouse, production, finance, and customers) in the supply chain were used while the sample size of 300 was selected which represent 85.7% of entire population. Questionnaires were administered in a structural manner using a Likert scale (1-5) and data collected was processed with SPSS Version 29 to establish the relationship between the independent variables which were the three 3PLs activities (supply relationship, Enterprise Resource Planning optimization and customer relationship) and dependent variables (revenue, cost and operational efficiency). Findings: It was observed that 45.5% strongly agree that 3PLs activities drives supply chain performance while 37 % agree that 3PLs activities drives supply chain performance This sum up the total level of agreement to 82.4 % while the rest 17.6 were neutral and disagreed that there are no impacts. The 82% (approximately) justified the goal of the study that 3PLs activities have an impact on supply chain performance in FMN Plc. The hypotheses drawn up in the research questions were further validated through a two-tailed t-test by comparing the computed value in excel with theoretical critical t-values on table. The three respective at 5% significant level were 2.35305, 2.5468 and 2.68735. The three hypotheses were tested against the null hypotheses to further validates the hypothesis that there is significant impacts of 3PLs activities on supply chain performance in Flour Mills of Nigeria outsourced activities. Implications to Theory, Practice and Policy: Resource based theory and Core competency theory may be used to anchor the future studies on investigating the impact of third party logistics activities on supply chain performance in Nigeria. Manufacturing companies have the ability to achieve and sustain competitive advantage if they possessed resources that are valuable, rare, imperfectly imitable, and non-substitutable. Therefore, firms should focus all resources that are strategically relevant within an organization and outsource its non-competencies in order to reduce cost of production and improve its supply chain performance. The study further advanced the core competency model by evaluating areas of shortage of resources, skills and capacity of the flour milling companies that enables outsourcing drives higher performance efficiency, revenue, and cost optimization of the organization.

Keywords: Third Party Logistics; Supply Chain; Customer Relationship; Operational Efficiency; Supply Relationship (search for similar items in EconPapers)
Date: 2024
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