the impact of inbound and outbound logistics …
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THE IMPACT OF INBOUND AND OUTBOUND LOGISTICS ACTIVITIES
ON THE SUPPLIER-CUSTOMER RELATIONSHIP
A CASE OF COCACOLA KWANZA COMPANY (T) LTD
By
LATIFAH KIMARO
A Dissertation Report Submitted in Partial Fulfillment of the Requirements for
the Degree of Master of Science in Procurement and Supply Chain Management
(MSc-PSCM) of Mzumbe University
2020
i
CERTIFICATION
We, the undersigned, certify that we have ready and here by recommending for
Acceptance by the Mzumbe University, a dissertation entitled The impact of
inbound and outbound logistics Activities on the supplier- customer relationship.
A Case of Coca Cola company Ltd, Dar Es Salaam.
In The Partial Fulfillment of the Requirement for the Award of the Degree of
Masters of Procurement and supply chain management of Mzumbe University.
______________
Major Supervisor
______________
Internal Examiner
_______________
External Examiner
Accepted for the Board of MUDCC
___________________________________________________
DEAN/DIRECTOR, FACULTY, / DIRECTORATE BOARD
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DECLARATION AND COPYRIGHT
I, LATIFA I. KIMARO, declare that this dissertation is my own original work and
that it Has not been presented and will not be presented to any other University for
similar or Any other degree award.
Signature .......................................
Date................................................
© 2020
This dissertation is a copyright material protected under the Berne Convention, the
Copyright Act 1999 and other international and national enactments, in that behalf,
On intellectual property. It may not be reproduced by any means in full or in part,
Except for short extracts in fair dealings, for research or private study, criticism
Scholarly review or discourse with an acknowledgement, without the directorate of
Postgraduate studies, on behalf of both the author and Mzumbe University.
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ACKNOWLEDGEMENT
My sincere thanks to the almighty God for the wisdom, love, care and protection he
accorded to me which enabled me to accomplish this academic research. Also, my
heartfelt gratitude goes to my parents, Mr and Mrs Kimaro and the rest of the family
members who have been the great pillars in my life since my childhood and
throughout my academic life.
Special thanks go to my lovely husband, Mr Hamad Hilal Msongera for the moral
support and encouragement he provided to me until the end of my academic research
also Special thanks go to my Supervisor Mr.Maige Mwasimba for the timely
assistance and words of encouragement he has accorded to me all throughout the
entire process of this study. May the Lord Almighty reward you abundantly.
I am also grateful to the staff of COCACOLA COMPANY Ltd Dar Es Salaam who
vailed me the necessary information and cooperation in the process of data collection
that has made possible this research report. Similar thanks go to all who got involved
in one way or another, in my endeavor to complete this study, especially my friend
Mr ALFRED AIN SALLWA, My lecturers and all the colleges in the research team.
I also acknowledge the moral support and encouragement from my fellow students
from the same class group (Happiness Bia, Salim Mwinshashi, Geofrey Muchuruza,
Francis Mkwabi and Magnus Stephan) Who stood with me during and before this
research study. May the Almighty God reward you all immeasurably!
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DEDICATION
I sincerely dedicate this work to my family, my supervisor, my lecturers and my
Friends.
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ABBREVIATIONS AND ACRONYMS
ANOVA Analysis Of Variance
Co Company
ERP Enterprise Resource Planning
FSN Fast-moving, Slow-moving and Non moving classification
FIFO First In-First Out
JIT Just In Time
SET Social Exchange Theory
SME Small and Medium Enterprises
USA United States of America
VMI Vendor Managed Inventory
TMS Transport Mnagement System
SPSS Statistical Package For The Social Sciences
SIG Significant level
(T) Tanzania
LTD Limited
TIS Transportation Information System
VED Vital, Essential and Desirable
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ABSTRACT
The main objective of the study was the impact of inbound and outbound activities
on the supplier-customer relationship, where four specific objectives were formed
from the main objective and that is the impact of material handling activities,
warehousing activities, Transportation Activities and Distribution activities on the
Supplier-customer relationship.
Geographically the study based in Tanzania in Dar Es Salaam region and the data
was collected at Coca Cola Kwanza Manufacturing Company the place was chosen
because it is a place where logistics activities are well practiced (both inbound and
outbound activities).
The researcher used three theories that are directly related to the study that is
Network theory, Social exchange theory and Game theory
The study involved 80 respondents as sample size from different departments in the
Coca Cola Kwanza Compan. Primary data were collected using questionnaires that
were self-administered by the researcher and review of documents was done in the
collection of secondary data. Data were quantitatively analyzed using correlation and
regression analysis with the aid of statistical Packages for Social sciences (IBM
SPSS Statistics 20).
The result revealed that Material handling Activities, Distribution Activities and
warehousing Activities have a positive influence to the supplier-customer
relationship, hence making the hypothesis Accepted, while transportation activities
do not influence the supplier-customer relationship, hence the hypothesis was
rejected.
The researcher recommended the Manufacturing companies to take a strong look to
the inbound and outbound activities so as to strengthen the bond between the
Suppliers and Customers and also increase the organization profit, Future researchers
should go further miles discussing, studying and finding out about other aspects of
inbound and outbound Logistics in manufacturing Industry both in private and
government sectors.. This will expand knowledge of the researchers but also benefit
the companies or their case studies they are researching on, since weaknesses and
recommendations will be provided.
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TABLE OF CONTENTS
CERTIFICATION ...................................................................................................... i
DECLARATION AND COPYRIGHT .................................................................... ii
ACKNOWLEDGEMENT ........................................................................................ iii
DEDICATION ........................................................................................................... iv
ABSTRACT ............................................................................................................... vi
ABBREVIATIONS AND ACRONYMS .................................................................. v
CHAPTER ONE ...................................................................................................... xii
OVERVIEW OF THE STUDY ................................................................................ 1
1.3 Statement Of The Problem ..................................................................................... 3
1.4 Objectives Of The Study ........................................................................................ 4
1.4.1 General Objective ............................................................................................... 4
1.4.2 Specific Objectives.............................................................................................. 4
1.5 Main Reserch Question .......................................................................................... 5
1.5.1 Research Questions ............................................................................................. 5
1.6. Scope Of The Study .............................................................................................. 5
1.7 Significant Of The Study ....................................................................................... 5
1.8 Organization Of The Study .................................................................................... 6
1.9 Limitation Of The Study ....................................................................................... 7
1.9.1 Time Constraints ................................................................................................. 7
1.9.2 Information Confidentiality ................................................................................ 7
1.10 Delimitations Of The Study ................................................................................. 7
1.10.1 Time Constraints ............................................................................................... 7
1.10.2 Information Confidentiality .............................................................................. 7
CHAPTER TWO ....................................................................................................... 8
LITERATURE REVIEW .......................................................................................... 8
2. 1 Introduction ........................................................................................................... 8
2.2 Definitions Of Key Terms And Concepts Of The Study ....................................... 8
2.2.1 Supplier-Customer Relationship ......................................................................... 8
2.2.1.1 The Common Characteristics Of Customer-Supplier Relationship M ............ 9
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2.2.2 Inbound Logistics .............................................................................................. 10
2.2.2.1 Inbound Transportation .................................................................................. 11
2.2.2.2 Warehousing Activities .................................................................................. 12
2.2.2.3 Material Handling .......................................................................................... 13
2.2.3 Outbound Logistics ........................................................................................... 14
2.2.4 Key Challenges Of Inbound And Outbound Activities In Supplier ........ 15
2.2.5 Important Factors To Be Considered In Inbound And Outbound In Building 16
2.2.6 Best Practices For Superior Customer Services ................................................ 17
2.2.7 Solution To Optimize The Inbound And Outbound Logistics Process............ 17
2.3 Theories And Concepts Of The Study ................................................................. 18
2.3.1 Theories ............................................................................................................. 18
2.3.1.1 Game Theory ................................................................................................. 18
2.3.1.2 Network Theory ............................................................................................. 19
2.3.1.3 Social Exchange Theory (SET) ...................................................................... 20
2.3.2 Concepts Of The Study .................................................................................... 21
2.3.2.1 Relationship Between Material Handling Activities And Supplier- .............. 21
2.3.2.2 Relationship Between Warehousing Activities And Supplier-Customer ...... 22
2.3.2.4 Relationship Between Distribution Activities And The Supplier-. ................ 22
2.4 Empirical literature review ................................................................................... 22
2.4.1 Foreign Studies ................................................................................................. 22
2.4.2 Local Studies ..................................................................................................... 25
2.5 Conceptual Framework ........................................................................................ 26
2.6 Research Hypothesis ............................................................................................ 26
2.7 Research Gap ....................................................................................................... 27
CHAPTER THREE ................................................................................................. 28
RESEARCH METHODOLOGY ........................................................................... 28
3. 1 Introduction ......................................................................................................... 28
3.2. Area Of The Study .............................................................................................. 28
3.3 Research Design ................................................................................................... 28
3.4.Target Population ................................................................................................. 29
3.5 Units Of Analysis ................................................................................................. 29
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3.6 Sample And Sampling Techniques ...................................................................... 29
3.6.1 Sampling Techniques ........................................................................................ 30
3.7 Sample Size .......................................................................................................... 30
3.8 Types Of Data ...................................................................................................... 31
3.9. Data Collection Methods .................................................................................... 31
3.9.1 Questionnaire .................................................................................................... 32
3.9.2 Documentary Review ........................................................................................ 32
3.10.1 Data Processing ............................................................................................... 33
3.10.2 Data Analysis .................................................................................................. 33
3.10.3 Descriptive Analysis ....................................................................................... 33
3.10.4 Pearson Correlation Coefficient Test .............................................................. 34
3.10.5 Multiple Regression Analysis ......................................................................... 34
3.11 Reliability and validity ....................................................................................... 35
3.11.1 Reliability ........................................................................................................ 35
3.11.2 Validity ............................................................................................................ 35
3.12 Measurement Of Variables ............................................................................... 36
3.13 Research Ethics .................................................................................................. 36
CHAPTER FOUR .................................................................................................... 37
PRESENTATION OF FINDINGS AND ANALYSIS .......................................... 37
4.1 Introduction .......................................................................................................... 37
4.2 General Information For The Respondents .......................................................... 37
4.2.1 Response Rate ................................................................................................... 37
4.2.2 Age Of The Respondents .................................................................................. 37
4.2.3 Gender Of Respondents .................................................................................... 38
4.3 Descriptive Analysis ............................................................................................ 40
4.4 Pearson Correlation Analysis ............................................................................... 52
4.4.1 Material Handling And Supplier-Customer Relationship ................................. 54
4.4.2 Warehouse Management And Supplier-Customer Relationship ...................... 54
4.4.3 Transportation Management And Supplier-Customer Relationship ................. 54
4.4.4 Distribution Management And Supplier-Customer Relationship ..................... 54
4.5 Multiple Regression Analysis .............................................................................. 55
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4.5.1 Model Summary ................................................................................................ 55
4.5.2 Analysis Of Variance (ANOVA) ..................................................................... 56
4.5.3 Coefficient Results ............................................................................................ 56
4.5.3.1 The Influence Of Material Handling Activities On The Supplier-Customer . 57
4.5.3.2 The Influence Of Warehousing Activities On The Supplier-Customer ......... 57
4.5.3.3 The Influence Of Transportation Activities On The Supplier-Customer ....... 58
4.5.3.4 The Influence Of Distribution Activities On The Supplier-Customer ........... 58
4.5.4 Summaries Of The Regression Analysis Findings............................................ 58
4.6 Hypothesis Testing ............................................................................................... 59
4.6.1: There Is The Relationship Between Material Handling Activities And) ......... 59
4.6.2: There Is The Relationship Between Warehousing Activities ......................... 60
4.6.3: There Is The Relationship Between Transportation Activities And Supplier- 60
4.6.4: There Is The Relationship Between Distribution Activities And Supplier- .... 60
CHAPTER FIVE ...................................................................................................... 61
DISCUSSION OF FINDINGS ................................................................................ 61
5.1 Introduction .......................................................................................................... 61
5.2 Reliability ............................................................................................................. 61
5.3. Discussion Of Demographic Information ........................................................... 61
5.3.1 Age Of Respondents ......................................................................................... 61
5.3.2 Education Levels Of The Respondents ............................................................. 61
5.3.3 Gender Of Respondents .................................................................................... 61
5.4 Discussion Of Objective-Wised Findings ............................................................ 62
5.4.1 The Influence Of Material Handling Activities On Supplier-Customer . ......... 62
5.4.2 The Influence Of Warehousing Activities On Supplier-Customer. .................. 62
5.4.3 The Influence Of Transportation Activities On Supplier-Customer. ................ 63
5.4.4 The Influence Of Distribution Activities On The Supplier-Customer. ............. 64
CHAPTER SIX ........................................................................................................ 66
SUMMARY, CONCLUSION AND RECOMMENDATION .............................. 66
6.1 Introduction .......................................................................................................... 66
6.2 Summary Of Findings ......................................................................................... 66
xi
6.3 Conclusion Of The Study ..................................................................................... 68
6.3.1 Material Handling Activities And Supplier-Customer Relationship. ............... 68
6.3.2 Warehousing Activities And Supplier-Customer Relationship. ....................... 68
6.3.3 Transportation Activities And Supplier-Customer Relationship. ..................... 68
6.3.4 Distribution Activities And Supplier-Customer Relationship. ......................... 69
6.4 Recommendations Of The Study ........................................................................ 69
6.4.1 Recommendation On Material Handling Activities .......................................... 69
6.4.2 Recommendation On Warehousing Activities .................................................. 69
6.4.3 Recommendation On Transportation Activities ................................................ 69
6.4.4 Recommendation On Distribution Activities .................................................... 70
REFERENCE ........................................................................................................... 71
APPENDIXICES ...................................................................................................... 75
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LIST OF TABLES
Table 3.1: Correlation Coefficient Ranges................................................................. 34
Table 3.2: Reliability Statistics .................................................................................. 35
Table 4.1: Response rate of respondents (N=80) ....................................................... 37
Table 4.2: Age Distribution Of Respondents (N=80 ................................................. 38
Table 4.3: Gender Distribution of respondents (N=80) ............................................. 39
Table 4.4: Education Level Of Respondents (N=80) ................................................. 39
Table 4.5: Material Handling Logistics On Supplier-Customer Relationship ........... 40
Table 4. 6: Warehouse Activities On Supplier-Customer Relationship (N=80) ....... 43
Table 4. 7: Transportation Activities on supplier-customer relationship (N=80) ..... 45
Table 4. 8: Distribution Activities On Supplier-Customer Relationship (N=80) ..... 48
Table 4. 9: Supplier-Customer Relationship (N=80) ................................................. 50
Table 4. 10: Correlation Coefficient Ranges ............................................................. 52
Table 4. 11: Correlations ............................................................................................ 53
Table 4. 12: Model Summaryb ................................................................................... 55
Table 4. 13: ANOVAa ................................................................................................ 56
Table 4. 14: Summary Of The Tested Hypotheses .................................................... 60
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LIST OF FIGURE
Figure 2.1: conceptual Frame Works ......................................................................... 26
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CHAPTER ONE
OVERVIEW OF THE STUDY
1.1 Introduction
The chapter is to provide the reader with the background and context of what was
searched and how the setting of the problem has guided and effect the respondents in
answering the questionnaires provided by the researcher. The study begins with this
introduction chapter that elaborates the essence of the study and rationale. This
chapter consists of the Background of the study, Statement of the problem, Research
objectives, Research questions, and significance of the study.
1.2 Background Of The Study
The history of logistics worldwide is traced from the early 1900s through its
implication is said to start beyond that period (Houe & Murphy, 2016). Different
scholars explained the birth of logistics that it resulted from the heavy military
activities among the giant nations by then (Houe & Murphy, 2016). The start World
War 1 in the 1914 accelerated the emerging of logistics concepts from material
handling and physical distribution management and later World War 2 strengthened
it even more (Christopher, 2011).
Logistics was by then referred as the branch of war that relates most to the
movement, supply and management of armies (Langat, 2013) the evolution of
logistics brought about necessary changes in the functions and activities executed,
from the military view to the business function that is inevitable to most enterprises
today (Mae and Ohno, 2012) in the 1950s, the evolution of logistics was adopted by
manufactures who managed to distribute the manufactured goods to the respective
markets (Mallik, 2010). The physical distribution was fragmented as the related
distribution functions had no relation to each other. In the 1960’s up to the 1970’s,
physical distribution evolution resulted in the recognition of other physical functions
in moving the manufactured goods, which are transportation, storage, material
handling and packaging. Many manufacturing companies shaped their organizational
structure to enable an effective execution of the emerged logistics functions (Shyam,
2012). In the 1980’s onwards, the activities were well defined and managed as to
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enable an integration of the functions as a whole since the centralization of logistics
in some enterprises had taken part. Another crucial mark in this era was the emerging
of warehousing activities that facilitated the entire business and enabled companies
meet the market demand in due time.
Currently, the logistics activities are categorized in the categories of inbound and
outbound logistics depending much on their functions and impact on the
organizational activities at large (Sumit,2015). The inbound logistics cover all the
functions and activities involved in the movement of materials received from outside
ones’ organization such as the material handling, warehousing and storage (Mallik,
2010). While the outbound logistics cover all activities and functions involved in
moving the goods from the manufacturing point to the customers such as
transportation, distribution and packaging.
In Tanzania and Africa at large, the emerging of logistics has passed through almost
the same evolutionary stage explained above, despite the time difference. Africa
adopted the development of logistics late compared to developed countries who
mostly were directly involved in the first and second world wars like Great Britain,
France, Russia, Japan, United States of America (USA), Germany and China. In the
early 1990’s, different logistics activities such as physical distribution were first
performed in Africa by the colonial regimes to serve their colonial motives. Most of
the items moved to African countries during the time were guns, gunpowder and
armies enable them to conquer the nations, while from Africa minerals such as gold,
copper and salt was transported overseas. In the 1920’s the emerging of the slave
trade made a significant turn of logistics activities as material handling was given
much attention. In a business perspective, logistics activities raised after
independence, as the Tanzanian Business men had to import a lot to serve the
internal market that was in high demand (Mwangi, 2013). From 1990’s to the
beginning of the 21st century, logistics activities are used much to strengthen and
influence the supplier- customer relationship. Talib (2011) in his study on the
importance of logistics activities revealed that, one of the major significances of
logistics activities is on influencing supplier-customer relationship. Traders and
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manufacturing companies need to customize their logistics functions and activities to
enable the safeguarding and strengthening of their relationship with their respective
potential customers for the aim of competing in the industry (Mishra, 2011). Most of
the empirical evidences show that the logistics activities, both inbound and outbound
logistics have an impact on the supplier-customer relationship and if the activities are
conducted well enough the respective organizations will benefit much. Up to date,
the literature of logistics and Supply Chain Management is insufficient in showing
the impact of the inbound and outbound logistics on the supplier-customer
relationship, and there rise questions like, is it a positive or negative impact, is there
a strong / moderate or weak relationship between inbound and outbound logistics
with the supplier-customer relationship; and are the logistics activities important
towards supplier-customer relationship? The motivation for conducting this study,
therefore, came from the fact that there is a need to understand the impact of inbound
and outbound logistics on the supplier-customer relationship.
1.3 Statement Of The Problem
Both inbound and outbound logistics activities are designed and executed to ensure
smooth flow of materials, equipment and personnel involved in moving the materials
and products, within and outside the organization. These logistics activities and
functions all together foster supplier-customer relationship to effect the business
performance at large. The supplier-customer relationship is vital in the success of
the business and of the customer (Choughri & Abdallah, 2016). This relationship
benefits the supplier as it promises a potential market, both present and in the future
(Lucia & Benedict 2015), while in the side of the customer, this relationship ensures
customer satisfaction through timely delivery, cost effectiveness and better quality
(Zhang, 2011).
Empirical evidence in the field of logistics and supply chain suggests that there are
many factors and activities that influence the supplier-customer relationship such as
trust, commitment, information sharing, supplier development and joint product
development. Since logistics activities are also part of the organization function, it
could be inferred that inbound and outbound logistics may also impact the supplier-
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customer relationship (Ghoumrassi & Tigu, 2017). But we are lacking scientific
proven knowledge regarding the impact of inbound and outbound logistics on the
supplier-customer relationship.
Over the years, different studies have revealed factors influencing the supplier-
custom,er relationship including customer services, shortage lead time, and good
delivery terms (Sumit,2015).Most of these researchers recommended that the
logistics activities have to be customized to enable a strong and beneficial supplier-
customer relationship.Contrary other studies revealed that, inbound logistics such as
material handling and warehousing activities and the outbound logistics such as
transportation and distribution are related to supplier-customer relationship
(Saleh,2013).Unfortunately, the studies ended by agreeing to the presence of the
relationship between the stated variable without considering the impact level.
What is still missing in the supply chain literature is the impact of logistics activities
(both inbound and outbound) toward the supplier-customer relationship. This
motivated the researcher to conduct the study and cover the missing literature gap on
the impact of inbound and outbound logistics activities towards improving the
supplier-customer relationship.
1.4 Objectives Of The Study
This study is guided by two sets of objectives, the general objective and the specific
objectives:
1.4.1 General Objective
The main objective of the study is to analyze the impact of inbound logistics and
outbound logistics activities on the supplier-customer relationship, a case of COCA
COLA KWANZA Co (T) Ltd
1.4.2 Specific Objectives
Specific objectives that guided the study are
i. To examine the impact of material handling activities of the supplier-
customer relationship at Coca Cola Kwanza Co (T) Ltd.
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ii. To determine the impact of warehousing activities on the supplier-customer
relationship at Coca Cola Kwanza Co (T) Ltd.
iii. To identify the impact of transportation activities on the supplier-customer
relationship at Coca Cola Kwanza Co (T) Ltd.
iv. To describe the impact of distribution activities on the supplier-customer
relationship at Coca Cola Kwanza Co (T) Ltd.
1.5 Main Reserch Question
What is the impact of Inbound and Outbound logistics activities to the Supplier-
Customer relationship?
1.5.1 Research Questions
i. To what extent does material handling activities impacts Supplier-Customer
relationship?
ii. To what extent does warehousing activities effects Supplier-Customer
relationship?
iii. What is the impact of Transportation activities on the Supplier-Customer
relationship?
iv. How does distribution activities impacts Supplier-Customer relationship?
1.6. Scope Of The Study
Geographically, the company is located at Mikocheni, Sam Nujuma Street, Dar Es
Salaam, that is 11km from where the researcher lives.The study was based in Coca
Cola Kwanza Company, as it is among the manufacturing companies that mostly
deal with logistics activities both inbound and outbound logistics. So the researcher
carefully selected the departments and issue them with questionnaires.
1.7 Significant Of The Study
For the researcher, the study is a partial fulfillment for an award of Masters of
Science in Procurement and Supply Chain Management, the study has improved the
research skills and understanding and it has added knowledge to the existing body of
knowledge in logistics activities (inbound and outbound activities) in relation to the
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supplier-customer relationship.The study has merged the theories and practices of
logistics, hence has helped the logistics manager and actors in making better
decisions regarding innovativenes and building supplier-customer relationship.
For both logistics companies and others which perform logistics activities, the study
has provided a better understanding on the factors promoting supplier-customer
relationships in inbound and outbound. To researchers and scholars, this study has
revealed useful information and references on logistics activities with respect to its
effect on building supplier-customer relationship in the context of Tanzania.
1.8 Organization Of The Study
The research report has been arranged and organized in the form of six chapters, as
shown below:
The first Chapter is an overview of the study, which introduces the study by
presenting the background of the study, the statement of the problem, objective of the
study, the research questions, the scope of the study, the significance of the study and
the limitations and delimitations of the study.
The second chapter that is the literature review presents the theoretical review,
starting with key terms, definitions and followed by relevant theories and models,
empirical review of previous studies, the research gap and the conceptual framework.
The third chapter is the research methodology, the chapter deeply explains the
methods that are used in our study. This chapter consists of the research design, area
of the study, the study population, sample size, sampling technique, data collection
methods, data analysis method, validity and reliability and ethical consideration.
The fourth chapter that is presentation and findings, presents the data obtained and
collected from the field and the secondary data. The presentation starts with
demographic characteristics of the respondents and is arranged in respect of the
specific objectives.
The fifth chapter presents the discussion of the findings in relation to other previous
relevant studies to the topic. The discussion is arranged in respect of the study
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objectives and is organized in a way to give a clear picture on the attainability of the
research objectives.
Lastly, the study ends with chapter six. This chapter presents a summary, conclusion
of the study in relation to the study objectives and findings, the implications of the
study of policies and practice and areas for further studies.
1.9 Limitation Of The Study
These are the traits that the researcher has met with them on data collection, which
have a direct influence on the interpretation of finding in the whole research
1.9.1 Time Constraints
Due to late response by the respondents, and some of the respondents have been so
busy so they were not considering the questionnaire as more important to them,
1.9.2 Information Confidentiality
Now days most of the organizations are usually reluctant to provide the information
needed by the person outside the organization, hence all the documents in the files
are considered as company secrets and not to be released to the person who is not
directly related to the organization.
1.10 Delimitations Of The Study
Shows the way researcher tried to solve the challenges.
1.10.1 Time Constraints
The researcher used more time to push up the process by daily reminding and
physical follow up to make sure the questionnaires are answered within the given
time.
1.10.2 Information Confidentiality
Also about the limitation of accessing information, the research has provided them
with a letter from the college, which gave them confidence in responding to the
questionnaires provided.
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CHAPTER TWO
LITERATURE REVIEW
2. 1 Introduction
This chapter attempts to define various concepts of the subject matter, reviewing
both theoretical and empirical studies conducted by other researchers within similar
context. The Conceptual framework of this study and the research gaps are also
given hereunder.
2.2 Definitions Of Key Terms And Concepts Of The Study
This study seeks to examine the impact of inbound and outbound logistics activities
on the Supplier -Customer relationship, from the main objective of this study there
are three (3) key terminologies that are well defined and explained deeply so as they
can be understood comprehensively. These terminologies are Supplier-Customer
relationship, Inbound logistics activities and Outbound logistics activities.
2.2.1 Supplier-Customer Relationship
Customer Supplier Relationship is the business relation between the customers and
the suppliers in terms of product quality, services, complaint handling,
deliveries, Customers and Suppliers are the important partners in business. Both have
the same goal- to satisfy end consumers. Hence, having a healthy Customer- Supplier
relationship is vital for any business (Stefan Koch,2015)
The Customer-Supplier relationship is seen as a business/transaction relationship that
usually emerge between the buyer and the seller, where the relationship is usually
affected by mutual trust, good communication, interdependence, proper cooperation
and true commitment. The supplier-customer relationship consists of three types of
relationships which are transactional relationship, collaborative relationship and
alliance relationship (Starling,2016).
Transaction relationship is the short term relation where it ends after every part has
fulfilled his/her obligation that neither customer or supplier have concerns of the well
being of the other party, hence most of the companies have this kind of relationship
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and the collaborative one, among them only few practice the strategic kind of
relationship,
The issue is that most of the organizations place their orders in small size, hence
unable to create a strategic relationship with the suppliers as they lack negotiation
power.
2.2.1.1 The Common Characteristics Of Customer-Supplier Relationship
Models Of Rahiim Et Al. 2008
The modal explained the types of relationship that does exist between the suppliers
and customers when transacting or dealing with commercial issues, and each type of
the relationship he tried to mention the characteristics also, where the relationship is
Transactional, leverage, bottleneck and strategic as explained below.
Transactional, Non critical, market exchange
a. The relationship is always short
b. Only few resources are allocated to the supplier
c. The relationship between the buy - sell is usually simple
d. Customer can easily change supplier
e. Mostly the local suppliers are used
f. Standard commodities
g. Absence of innovation
h. Demand is usually stable
Friendly, leverage, captive supplier
a. The customer has more power than suppliers, hence suppliers
mostly depend on buyers.
b. Customer find suppliers for every product
c. Existence of strong competition between the suppliers
d. High ranked engineering experiences.
Business partnership, bottleneck, captive buyer
a. The suppliers have more power, hence customers depend much
on suppliers.
b. The competition power between suppliers is increased.
c. The buying level is usually high.
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d. Suppliers are mostly creative
e. Suppliers owns the technology
f. High bargaining power of the suppliers
g. High product variety from the suppliers.
Familiar, strategic, strategic partnership
a. Long term relationship between customer and supplier.
b. Customer invests more on suppliers innovation
c. The joint venture between customer and supplier is more
powerful
d. The Customer develops supplier technical skills.
e. Buying level is usually high.
f. The use of international suppliers
g. Research and development to the suppliers
h. Production of complex commodity
i. High power competition between suppliers
j. Switching cost of suppliers is usually high
k. Product development planning
l. Fewer numbers of suppliers.
2.2.2 Inbound Logistics
Defined as the activities which are related to sourcing, acquiring, storing and
delivering of raw materials and parts to the product or service department. It is part
and parcel of the operations, for a firm involved in the manufacturing business, in
simple terms, inbound logistics are the fundamental activity, which focuses on
buying and scheduling the inflow of materials, tools and final goods, from suppliers
to the production unit, warehouse or retail store (Madison, 2019).
Inbound logistics include all those activities, which are substantial to make the goods
available for operational processes when they are needed. It encompasses materials
handling, stock control, inspection and transport to facilitate the production or market
distribution Madison( 2019). Inbound logistics deals with the flow of raw materials
or finished goods from the source for the purchasing organization, through inbound
logistics the daily business operation is well supported and creates efficiency and
11
effectiveness through the delivery of necessary materials that are crucial to the
organization (Shyam, 2012).
Baker and Rushton (2008) added that, inbound activities concerned with the
collection and transportation of inbound shipments, warehousing and management of
inventories, where throughout the activities, the supply chain cost is minimized,
inventory is kept at optimum levels and good enough it improves the customer
services.
2.2.2.1 Inbound Transportation
Coyle (2011) explained that, the inbound transportation simplifies business
organization and makes the transfer of product ownership easily as many
organizations enjoy utilities of places and time through the movement of product or
materials from the source to the place needed. Firms in different organizations are
free to opt either one or combines several modes of transportation so as to effectively
make the materials reach the targeted destination safely for the scheduled production,
where if transportation is well done, it will make the supply chain efficient and the
goods to be delivered to the customer in an economical and secure way (Branch,
2009).
More important is that the inbound transportation should plan for delivery time, so as
the product to reach to the final customer as specified., hence for the great
performance, firms must make the material flow in a right order, quantity, quality
and time Bowersox (2010). Shipment can make a consolidation of many orders to
form a large quantity per shipment a thing that will make the attainment of
economies of scale and less transportation cost per unit, (Ulku, 2009). As there are
different procedures at a country’s entry point relating to customs compliance, which
automatically increases the transaction cost, hence there should be a proper
documentation by the firm so as to enable faster clearance and make the impact of
global sourcing lead time reduced. Zamora-Toires (2013). Explained that, the firm
should positively run with the technology by submitting all the necessary information
and documents electronically so as to cut down necessary delays/bureaucratic cost
Hanoiz et al (2014), the use of tracking and tracing shipment tools by collecting and
12
managing the information about the product location that Is on transit across he
supply chain, this will assist on detection and deduction of transportation losses an
interruption. Helo (2011) and Dukare (2015) believes that, real time tracking will
ensure Goods traceability and delivery visibility.
Firms should also increase the use of freight and forwarders/transport intermediaries
as they improve operational efficiency and customer service levels as they have
enough industry knowledge and skills, most of them offer the related services such as
multimodal transport arrangement, warehousing, less-than-truck loaded transport and
express parcel services (Asian Development Bank, 2012).
2.2.2.2 Warehousing Activities
According to Karaduman and Udeli (2015), warehousing flows primarily in two
ways, the first is through the inbound flow where goods are received and well sorted
from the supplier and the other flow is an outbound flow where the goods are
retrieved and moved to the targeted customer, supply chain management ensures that
the inventory that are kept in the warehouses are at optimum level and meets the
customer orders.
Inbound warehouse includes the activities such as inspection, receiving and storage,
hence through the said activities, it facilitates the receipt of goods into the
organization and also supports the inventory management by holding stock for
business operations. Gibson (2013) added that, the inventory in the warehouse can be
well managed through the use of information system integration. As a vendor-
managed inventory (VMI) ensures the sufficient supplies as the suppliers are mostly
responsible for order replenishment based on the inventory that are available in the
warehouse.
A firm will engage itself in inventory management so as to ensure goods are
available in right quantity, quality and at specified times, hence this will make them
deliver at optimal service level and at controlled cost. Reid and Sanders (2007).
Receiving of goods usually begin very shortly after the goods have been delivered to
13
the warehouse and the activities that involves are usually unloading, inspection of
whether they are of the right quantity, sufficient quality, and the written inspection
records are always updated as per new order delivered. (Koster et al, 2006).
Cross docking can be practiced as well, as the incoming goods can directly be sorted
to outbound transportation vehicle ready for distribution top the customers, the
system helps the organization to save itself from the stock holding cost (Stephan and
Boysen, 2011).
2.2.2.3 Material Handling
According to Saxena (2003) Material handling system is the one of the important
factors needed to be considered during the organization’s operations. Because it
involves the moving, packaging Storing of substance in any form. Various types of
materials are stored in the warehouse. Each material has its own characteristics.
According to Burton (1999), stock tracking and recording is among the essential
issues under effectiveness of material handling. Impartial of doing so will cause a
huge and unimaginable loss to the organization. In the book of effective warehouse
the misuse of equipment were instead to be prevented skill in operation and to fall
rules existed.
Principles Of Material Handling
According to Gopalakrishman (1990) in handling of materials there are some
principles to be considered as follows; Orientation principle,Planning principle,
Systems principle, Unit load principle, Space utilization principle,Standardization
principle, Ergonomic principle,Energy principle,Ecology principle,Mechanization
principle,Flexibility principle,Simplification principle, Gravity principle,Safety
principle, Computerizationprinciple,System flow principle,Layout principle, Cost
principle, Maintenanceprinciple Obsolesce principle, hence when the principles will
well be kept into consideration materials in the warehouse will be safe and the
organization.
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2.2.3 Outbound Logistics
Outbound logistics, is the collection, storage and distribution of the final goods and
related information flows, from the manufacturing plant to the end user. It covers all
those activities (Selecting, Organizing and transporting) which are involved in the
outflow of merchandise from the seller to the buyer (J-Matthew and Tan- Miller,
2015).
Outbound logistics, in the case of a tangible item, can be warehousing, material
handling, inspection and transport, etc., but for intangible ones like services, it is
associated with setting for bringing customers to the service location. Hence inbound
logistics include all the activities that are concerned with order placement to the
suppliers. On the other hand, outbound logistics cover all those activities that involve
dealing or trading in products produced by the company (Madison (2019).
Outbound logistics is defined by the council of supply chain management
professional as the movement and storage of goods/product from the end of the
production line to the final user, and it is very vital in customer supplier relationship,
retailers tend to choose or stick on the supplirs that do timely delivery on them, as on
failure it may impact on financial penalities and even eliminate of suppliers product
from the retailers active portfolio, so thus the outbound logistics affects much the
decision on retailer on either or not to stock the supplier’s product and also stands as
a the important determinats of supplier’s supply chain and business success (Tan -
Miller and Matt- liberature,2015).
According to Tilanus (2017), outbound logistics is the movement of goods outward
from the end of the assembly line/warehouse to the customer, where most of the
literatures argue that, outbound logistics is customer oriented operation management.
If outbound logistics are effectively and efficiently operated it creates a positive
influence not only on the performance of the business, but also on the customer
perception of the quality product and services provided by the firm. In case of any
uncertainty in outbound flow, it will create the dissatisfaction to the firm’s customer
base, when used properly, it is a strategically important bridge in achieving
15
competitive advantage Bowersox et al (2010). Hence logistics providers should
properly align with customer’s choice and focus on service quality priorities
(Manikas and Leromonachou, 2016)
It is very important for the organization to pick the right distribution channel/network
and maintain a sensible inventory stocking system and optimize delivery options so
as to make the outbound logistics run effectively and efficiently.
According to Madison (2019), outbound logistics goes through different steps as te
sales department first receives order from the customer, after then the department
checks the availability of the ordered goods so as they can fulfil the order, the order
is now sent to the warehouse department for picking and packing, then the order is
shipped to the customer destination and warehouse cleark proper updates inventory
level, lastly the business bills is collected and cash is received by the client from the
ordered goods.
In contemporary Era,logistics plays an important part in supply chain
management,most of the organization have become more and more competitive,
hence in order for them to reduce the total company cost, they have engaged
themselves in cost reduction strategies, so in understanding the role that is played by
logistics activities (inbound and outbound) on the supplier-customer relationship,the
organizations will then be able to understand various factors, challeges, and
understand various solutions that are involved in managing the relationship between
the parties.
2.2.4 Key Challenges Of Inbound And Outbound Activities In Supplier-
Customer Relationship
Finding the reliable supplier with stable and competitive price that will make the
relationship between them last with no disputes inlongrun is a challenge, Very
difficult to estimate the work that an organization is able to accomplish within a
given time so as the customer could receive the ordered package on time, The
manufacturing and logistics departments being well aligned as per the requirements
of the customers., To properly manage the company transportation from all the
16
suppliers so as to make sure there are no delays in production line due to lack of raw
materials, To receive the materials from the suppliers on time and maintain the best
storage and ensure proper quality control so as to make the customer receive quality
finished products, To process the customer orders and prepare cargo for the
distribution activities that includes packaging, addressing and the hiring of the most
appropriate transportation solution to deliver it properly, Issuing of all necessary
transportation documents, Searching for the most reliable and affordable transport
partners that will provide door-door delivery service to the destination point of the
customer, The reverse logistics strategy to be used by the customer if the product did
not satisfy his/her need or in case of any damage and Keeping track of the cargo
throughout the entire freight process so as to ensure timely delivery of the finished
goods/products to the customers.
2.2.5 Important Factors To Be Considered In Inbound And Outbound In
Building Customer-Supplier Relationship
Technology improvement, mostly on inbound programs as it helps supplier to track
the delivery of final products to their customers, Continuous measuring of the key
performance indicators of a company as it helps in the cost reduction, on time
pickups and delivery, a thing that automatically strengthens the relationship,
Keeping stocks at optimum level, cutting total overhead cost and developing a cost-
effectiveness and efficiency, The bonds between the suppliers and customers will be
strengthened by keeping optimal products in stocks, timely delivery and efficient
moving products through the warehouse so as to avoid losing sales,By hiring drivers
with good interaction skills a thing that will ensure positive business relationships
between the company and the client as the transportation of goods is one of the last
interaction a retailer has with suppliers, so it’s important to focus on relationship,
The use of transportation information system (T.I.S), and as companies increase
supply chain visibility and easy to identify the weakness in inbound freight and any
inefficiency in logistics.
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2.2.6 Best Practices For Superior Customer Services
As providing customer service being more important than low product costs,
logistics plays a very great part on that, hence companies should struggle on their
level best to provide their customers with high quality services that will add value to
them.
Most of the companies focus more on outbound logistics and put a little effort on
inbound logistics, however, in order to attract customers, the company should take
into consideration all the two parts because they all have an impact on the customer
satisfaction, in order for the company to improve its performance in providing
services, it should work on solving different problems from customers and make
them more delighted.
Reverse logistics should also be taken into consideration by the company, where the
reverse logistics strategies will reduce storage and distribution cost, improves brand
reputation, satisfy customer demand and reduces waste to the environment, but
unfortunately many companies do not pay attention to this kind of logistics.
The company also should invest in the use of Transport Management System (TMS)
as is a software which will give a detailed report on shipping record for inbound,
outbound and reverse logistics and reduce the overall transportation cost.
Importance Of Transportation Management System
i. Increase the usage of preferred carriers
ii. Ensures better routing
iii. Lower cost mode selection
iv.
2.2.7 Solution To Optimize The Inbound And Outbound Logistics Process
As most of the experts consider the inbound activities/process as a final frontier, so
there is a great need of the company to invest in effective transportation and making
sure that the transportation cost is reduced.managing transportation is not as easy as
many people think but companies should keep more effort in managing their supply
chain and warehousing operations.in order for the company to build a strategic
relationship between the supplier and the customers should use transportation
18
System Management which will help the company in tracking the goods that are in
transit and also reduce the transportation cost.
On the other hand, the outbound logistics is more concerned with getting your
products to the customers, hence here the company deals more with warehousing
activities, the Warehouse Management System should be employed to improve the
outbound logistics activities. The inventories in the warehouse can be controlled
through,
i. ABC Classification
ii. FSN Classification
iii. VED Classification
And also the use of cross docking for warehouse operations.
2.3 Theories And Concepts Of The Study
Here under are different theories and Concepts that explain supplier- customer
relationship as related to the topic, the theories under have tried to explain the
relationship between the concepts,the theories have been explained critically and the
way they link to the study.
2.3.1 Theories
2.3.1.1 Game Theory
The theory was introduced by John Von Newman and Oskar Morgenstern in the
1940s, the theory was only planned to be used in numerical form or mathematical
approach, the theory believes that, the success of any decision making usually
depend on the interaction and involvement of both parties, hence everybody in the
chain should be aware of any strategic decision with the correct information and at
the right time (Rosental, 2015).
The theory also explains that, there will be no information obstacle if agents in the
chain can freely express their opinions or satisfactions toward different decisions for
the well being of the organization that will help in achieving the company goal
(Camerer 2013). The theory believes that, the relationship between supplier and
19
customer will be productive if there will be a proper information flow and
understanding between the parties (Tadelis, 2013).
The theory has tried to show how the parties that is customer and supplier will
cooperate so as to reduce risk, obtaining insight regarding the competitors and also to
improve internal decision making process so as to make the final user delighted with
the service offered, the theory also has tried to show the resercher some of the
important factors that suppliers and customers should consider so as to strenghen
their relationship.
2.3.1.2 Network Theory
Is the grand theory for supply chain management that was introduced in 1970s, the
theory was targeted to describe the relationship between players in the supply chain,
suppliers, customers and end users. The theory had a focus more on the relationship
between the customer and supplier as they play a very big role in the supply chain
that is without suppliers, nothing will be produced and without customers nothing
will be generated as a profit in the company hence the collapse of supply chain, the
theory also has explained on how the strategic alliance will be made upon the two
parties (Harland,2015). The theory also suggested that, the resources can well be
developed when there is a continuous relationship between the players in the chain,
hence the resources of the two parties will easily be be combined so as to meet the
organization’s goal (Hollardson, 2007).
The theory assumes that, when knowledge and information could well be shared
within the network, this could build competitive advantage within the chain and the
relationship could be stronger if it was built with trustworthy (Smarajit Ghosh,
2015).
Hence, through the theory the researcher has been able to know on how the inbound
and outbound activities are coordinated with the players so as to create a strong bond
relationship is built in terms of trustworthy, value adding, long term relationship and
the transfer of knowledge so as to have the best performance and the competitive
20
advantage, as the main goal of many supply chain networks is to maximize their
revenues, hence if there will be a strong bond between the suppliers and the
customers it will make the supply chain achieve its goal.
2.3.1.3 Social Exchange Theory (SET)
The theory can well be applied in the context of supply chain management and act
as a very good weapon in analyzing the customer- supplier relationship (Holtharsen,
2013) the theory was drawn from the field of social-psychology to explain social
exchange and stability as a process of negotiated exchange between the two parties
(Emmerson 2017).The SET is not only a theory, but rather the reference point from
which so many others can talk to one another, the theory believes that human
relationships are formed by the use of subjective cost-benefit analyses and the
comparison of the alternatives (Emmerson, 2016).
The founder of SET theory Homans (1958), summarized the system of social
exchange into three propositions (Cropanzano &Mitchell, 2005):
i. The success proposition – When a person is rewarded for his or her actions, he
or she tends to repeat the action.
ii. The stimulus proposition – The more often a particular stimulus has resulted in
a reward in the past, the more likely it is that person will respond to it
iii. Deprivation – The more often in the recent past a person has received a
particular reward, the less valuable any further unit of reward becomes.
In principle, SET talks about human behavior, that it is characterized by rational
calculations designed to maximize individual profit. Humans value things that bring
them advantage; therefore they find it rewarding to be in a relationship with an entity
that enhances social status. This is what Humans, one of the pioneers of the theory,
classified as rewards (Cropanzano & Mitchell, 2005). Apart from rewards, there are
also costs. These costs exist when there is a negative value or advantage for an
individual in the exchange. For example the relationship that costs person, money,
time and efforts to coordinate with the other party (Cropanzano & Mitchell, 2005).
21
The SET deals with interactions or communications that eventually creates a feeling
of obligation between the parties involved in the exchange process (Cropanzano and
Mitchell, 2005). These interactions are usually determined by the people in the
exchange activity. The authors go further to explain that the exchange process
between a buyer and a seller, for example, has the potential to generate high quality
relationships. On the other hand, a series of interdependent transactions can result to
interpersonal attachment, and this is a very important notion to SET (Cropanzano and
Mitchell, 2005). There are two types of relationships formed, interpersonal
attachments and transactional relationships. According to the SET notations,
customers usually do considering some social norms like trust. Through a
trustworthy exchange relationship there is a great chance that the buyer-seller
relationship to last long and leads to increased business performance (Holthausen,
2013).
Through the SET theory the researcher has been able to see how the parties in the
supply chain interact,how do they exchange and share their costs and benefits, the
inter depence they have in each other when performing the logistics activities and
even the kind of the relationship that the key players have if it is the long term kind
of relationship or the shor term.
2.3.2 Concepts Of The Study
2.3.2.1 Relationship Between Material Handling Activities And Supplier-
Customer Relationship.
Kosonaim&Chikanha (2012) disscused that, Material handling has an effect on every
operation, that is from forecasting to production and even after sales services a thing
that effects production and organization profitability, material handling activities
uses the variety of mechanized and manual material handling equipments and
systems, hence if well operated they do improve the customer services, lower
production cost, creating optimum inventory and shortens the lead time, and vice
versa if poorly operated, so the organization should be very carefully in planning for
material handling activities as it has an effects in supplier-customer relationship.
22
2.3.2.2 Relationship Between Warehousing Activities And Supplier-Customer
Relationship.
As warehousing process improvements focus on the information, process, material
flow and warehouse layout, by the practice of industrial engineering methods, tools,
techniques and the application of modern software, it leads to the improvement of
material flow, reduced inventory, reduced lead time, improves the organizational
service level and creates an efficiency and effectiveness in the warehouse operations
a thing that has an impact in the supplier-customer relationship. (Karaduman and
Udeli, 2015).
2.3.2.3 Relationship Between Transportation Activities And The Supplier-
Customer Relationship.
By choosing the right transportation mode that will allow the achievement of goods
and services at the right time with the customers, transportation departments working
in an effective and efficient way, meeting the customer service level by the
transportation departments have an impact in the supplier-customer
relationship.(Branch,2009).
2.3.2.4 Relationship Between Distribution Activities And The Supplier-
Customer Relationship.
Madison (2019) wrote that, When the organization picks the right distribution
channel or network, and improve the delivery options to make the outbound logistics
run effectively and efficiently it will improve the bond between the supplier and the
customer.
2.4 Empirical literature review
2.4.1 Foreign Studies
A study by Ohno and Mae (2012) that was conducted in Swiden, that was titled by
“The impact of altering lead time on the performance of inbound logistics in an
international supply chain the case study of Volvo Powertrain Corporation.The study
found that, Total cost of the organization was directly dependent on purchasing and
logistics activities and not leadtime reduction, Also any changes in delivery lead time
23
will affect the cost of ownership and flexibility in delivering of services and if the
lead time is reduced it will positively affect the company progress.
The shortcoming of the study is that, it failed to address the relationship between
inbound logistics activities in supplier-Customer relationship as it only based on how
lead time affects the inbound logistics performance.
Also a study of Kosonaim and Chaikanha (2012) that was conducted in Ghana, that
was titled by Inbound logistics Models for Thai Sugar industry, The study revealed
that, different firms/organization practicing similar inbound logistics chain will have
different efficiency levels as it depends to their management in the organization,
Also inbound logistics activities automatically impacts the management system that
deals with inbound operations.
The shortcomings of the study is that, it only focused on processing firms, and the
study based on Thai firm only and it did not show the connection between inbound
logistics activities and supplier-customer relationship.
The study by Langat (2013) that was titled by the Application of inbound logistics
management on performance of procurement at public bodies in Kenya, the study
revealed that, the models of transport like sea, air, road and rail have much impact on
delivery leadtime where delivery of goods in any organization depends on the modes
efficiency, Also the inbound transport services should have regular checkup and
consistent evaluation, and, when the organization does not employ morden
technology in practicing inventory,it will affect the customer services negatively and
automatically will increase the inventory cost.
The shortcoming of the study is that, it only focused on public institutions and it did
not address how the inbound activities affect Customer-Supplier relationship.
A study by Mwangi and Waweru (2013) conducted in Kenya, that was titled by role
of transport in supply management a case study of Safaricom, the study revealed that,
transport is an integral part in the supply chain, also Transportation cost has a great
24
impact mostly on large scale industries and the delays in transportation affects the
cost of goods and services.
The shortcoming of the study is that, it only focused on transportation as an inbound
activity, and also it only focused on a single firm so it does not reflect the status of
other firms and it did not show the connection between the transportation and
customer-supplier relationship.
Also a study by Mamorena Lucia Matsoso and Olumide Henrie Benedict (2014), that
is titled by The customer-Supplier relationship in supply chain Management a case
study of Small manufacturing enterprise (SME) perspective South Africa that
involved exploratory study and purposefully selected.. The study revealed that,
i. A Good relationship between the supplier and the customer in the supply
chain it improves performance and enhance speed delivery of goods and
services to the targeted final destination and it has an impact on JUST IN
TIME (JIT).
ii. For a manufacturing firm to be in a competitive position, its customers must
take priority in service delivery at a level that it will aim at a shorter lead
time. (Spring, 2007:658)
iii. If both parties maintain flexibility communication regarding matters that
affects the value chain, it will have an influence in the attainment of JIT, And
there other crucial measures to take place before the implementation of JIT
production system and that is,identification of prominent supplier to work
with,long term relationship with supplier, quality performance that focuses on
supplier, reliable and trustworthy suppliers in which there products are sold at
more economical cost,So JIT alone is not a solution toward succesfull Supply
chain entities.(Talib et al,2011:282).
iv. Even with only few suppliers it will enable a firm to cut costs while
maintaining competitive environment, so the suppliers have to be early
involved in the design and development a thing that will improve more
relationship between supplier and buyer (Mishra -RK, 2011).
25
v. Long term relationship with few suppliers that is well and strategically
managed has a positive impact on the financial performance of a firm (Carr
and Pearson, 1999:497)
vi. A reduced number of suppliers will lower the level of mistrust between
buyers and suppliers because when few partners are involved in the chain it is
easy to enhance ways of communication that is improved as a result of fewer
people. (Koh et al, 2007:109)
vii. Most buyers do not have negotiation power with their suppliers due to the
small order they place for them.
2.4.2 Local Studies
They were no records of people who conducted the same research, but here below
are the ones that somehow relate.
A study by (Saleh, 2013) about the effect of trust in Buyer-Supplier relationship, A
case of Iringa Food And Bevarages, the study revealed that, when the relationship is
well managed automatically it will lead to supplier Competency, interpersonal
relationship and positive outcome, also investing in advanced technology that could
make the produced output to be of high quality, timely delivery, proper scheduling of
transportation routes and keeping the inventories at minimum in the warehouse has a
great chance in strengthening the relationship between the suppliers and the
customers.
A study by Mwakibinga (2007) at the University of Dar Es Salaam under the
heading of “the impact of material handling systems and equipments in the
organization” the study revealed that, poor storage methods applied by the
government stores department is one of the major causes of the losses in the
organization. The study concluded that there is a great relationship between the
storage and material handling activities and the organization performance, the
recommendation of this study was that, material handling activities should be
performed with the advanced systems and equipments so as to foster production and
inturn produce high profit to the company.
26
2.5 Conceptual Framework
After passing through the theoretical and empirical studies that have tried to explain
the theories behind inbound and outbound logistics and their impact on the supplier-
Customer relationship, the researcher has come up with the conceptual framework
which will help in understanding the connection between variables in simple terms.
Independent variable
Material Handling Activities, Transportation activities, Warehouse activities,
Distribution activities.
Figure 2.1: conceptual Frame Works
Independent variable
Dependent Variable
Source: Field data (2020)
2.6 Research Hypothesis
H01: There is the relationship between Material Handling Activities and Supplier-
Customer Relationship
H02:There is the relationship between Warehousing Activities and Supplier-
Customer Relationship
H03:There is the relationship between Transportation Activities and Supplier-
Customer Relationship
H04:There is the relationship between Warehousing Activities and Supplier-
Customer Relationship.
Material Handling Activities
• Material handling system
Warehousing Activities
• Order picking and packing
Transportation Activiteies
• Quick Response
Distribution Activities
• Distribution channel
Supplier-Customer Relationship
• Ontime payment • Trust • Risk sharing • Need are well anticipated • Open communication
27
2.7 Research Gap
The study has focused on the impact of inbound logistics activities and outbound
logistics activities on Supplier-Customer relationship a thing that is different from
other studies that researcher have passed through which they have only focused on
inbound logistics (Mae and Ohno (2012), Langat (2013), Mwangi and Waweru
(2013)) and the other ones on the supplier-customer relationship (Mamorena &
Olumide (2014), forgetting about outbound logistics.
Also the studies, especially of Matsoso and Benedict (2014) had only talked about
how JIT has an impact on the supplier-Customer relationship and explaining the way
to implement JIT so as to strengthen the relationship between the parties, so the
changes will be done by the researcher by showing how the inbound logistics and
outbound logistics will impact the customer-supplier relationship and the way to
implement the logistics activities so as to strengthen the relationship.
The study has been conducted in Tanzania a thing that is different as most of the
studies conducted outside Tanzania that is Kenya and South Africa so very hard to
reflect the findings with the home country.
Most of the studies have employed the qualitative study and only a few have mixed
both qualitative and quantitative a thing which has been different from this study as
it will only base on quantitative studies to show the differences.
As most of the studies have only focused on single activities from inbound and
outbound logistics and that is Transportation, a thing that is different from this study
as it has explained about more than three activities that is Transportation,
Warehouse, Distribution and material handling. As most of the studies do not focus
on manufacturing industries and if they did, they only focused on single firm hence
the research has focused on the manufacturing firm in general and not only one firm.
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CHAPTER THREE
RESEARCH METHODOLOGY
3. 1 Introduction
This chapter deeply explains the methods that were used in our study from the initial
stages until the final stages. This chapter consists of the research design, area of the
study, the study population, sample size, sampling technique, data collection
methods, data analysis method, validity and reliability and ethical consideration.
3.2. Area Of The Study
The company is located at Mikocheni, Sam Nujuma Street, Dar Es Salaam, that is
11km from where the researcher lives. Coca Cacola Kwanza is among the
manufacturing companies that mostly deal with logistics activities both inbound and
outbound logistics, so it has been easy for the respondents to respond to issues about
logistics activities and the effect on supplier-customer relationship, also the area has
been easily accessible by the researcher as it takes only the maximum of 24 minutes
for the researcher to reach the company place from where the researcher lives, so it
enabled on saving time and cost, hence the research kept more focus on the
department that mostly deals with logistics.
3.3 Research Design
According to Chikoko & Mloy (2015) research design is a plan, it reflects the steps
which are to be used to achieve the research objective, where the design comprises of
data collection procedures, analysis and presentation, on the other side, it can be said
that the research design provides full details on the type of data collection and
techniques to be employed in the field, it’s a blueprint for collection, measurements
and data analysis (Kothari, 2004).
The researcher employed case study design that allows cross sectional data collection
in order to examine the impact of logistics activities towards the supplier-customer
relationship. The quantitative approach has been used to guide the study in showing
the impact of the independent variables towards the dependent variable. The
29
approach enabled the use of relationship analysis techniques such as regression
analysis. (Hussey and Hussey, 1997).
3.4. Target Population
Population is a large group of people, individuals and item in a particular area from
which samples are drawn for measurements (Kothari, 1990). Population as the group
of people or person who mostly share the same characteristics (Kombo,2003). The
target population of the study was 400 where it included procurement department,
warehousing and storage department, Transportation and distribution department,
Nearby Customers of Cocacola who are their official Agents who are found near
Cocacola about 4-5km, the suppliers of Cocacola who supplies them with the raw
material such as Silafrica who supplies Crates, Kioo who supplies Bottles, Juzer
supplier who supplies Spare parts, and other supplier such as Superdol, Cfao,
Copycat and Kanji Lalji. Hence, from the above population the researcher was able
to draw the sample size.
3.5 Units Of Analysis
The unit of analysis is the major entity that the study is analyzed to, where the unit of
analysis may consist of individuals, groups, artifacts (books, photos, newspapers),
geographical units (town, census tract and state) and social interactions, (William,
2020). The unit of analysis of this study was the departments that deal with logistics
activities at Coca Cola Company.
3.6 Sample And Sampling Techniques
According to SapFord (1991), it is likely a research to determine their sample using
the geographical location where respondents can easily be collected in the field.
The researcher has opted to use sampling due to Coca Cola having a big number of
population it has been difficult to reach them on time, and also through sample there
is more accuracy of data, and the cost is low in sampling compared to the use of
entire populations, Hence the sample that were drawn from the target population as a
subset have represented the whole population, the sample population was 80
respondents from procurement department, warehousing and storage department,
30
Transportation and distribution department, Nearby Customers of Cocacola who are
their official Agents who are found near Cocacola about 4-5km, the suppliers of
Cocacola who supplies them with the raw material such as Silafrica who supplies
Crates, Kioo who supplies Bottles, Juzer supplier who supplies Spare parts, and other
supplier such as Superdol, Cfao, Copycat and Kanji Lalj
3.6.1 Sampling Techniques
A sample is a small portion that represents a total population in the process of data
collection, the sample has been identified and drawn from the large population, and
also the researcher has shown how the process has been used to select the sample,
and the description of sampling procedures and the sample size of the study
(Dawson, 2002).
Procurement department, warehousing and storage department, Transportation and
distribution department, Nearby Customers of Cocacola who are their official
Agents, the suppliers of Cocacola who supplies them with the raw material such as
Silafrica who supplies Crates, Kioo who supplies Bottles, Juzer supplier who
supplies Spare parts, and other supplier such as Superdol,Cfao, Copycat and Kanji
Lalji were selected by using random sampling, the above departments were prefered
because the researcher believed on getting the reliable information from them as
they are directly involved in inbound and outbound activities.
3.7 Sample Size
A sample is a small number of people or group that is drawn from the entire
population, hence when carrying up a research study the sample should be taken
from the population and whose the results or findings are going to be generalized
(Saunders, 2000). The researcher drew a sample of 80 respondents where were from
Procurement department, Transportation and distribution department, warehousing
and stores department, Suppliers and Customers. In order for the research study to be
more accurate the sample size must be at least 5% or 10% of the entire population
and this is what exactly the researcher applied. (Kothari, 2009) also the formula was
even applied in obtaining the accurate sample size of the study area.
31
NF = N____
1+ N(e) 2
Where: NF =the desired sample size where the population is less than 1000
N =the estimated of the population size (400)
e=Estimated sample error
Therefore;
NF = 400
1+ 400(0.1)2
80 Respondents.
Therefore the sample size of the study was 80 respondents.
3.8 Types Of Data
The researcher used the two types of data in this study, the primary and secondary
where the primary data are those that are directly collected from the field and are
fresh and collected by the researcher himself. (Kothari, 2009). For this type of data
the researcher used questionnaires and observation method.
The other type used is secondary data, this is a kind of data that was already collected
by other person, so the researcher uses them as a reference to be reviewed and mostly
they do match with the research topic or study (Hodges &Video, 2005).Under this
data type, the researcher reviewed various literatures from professional journals
concerning logistics activities and supplier-customer relationships, different
publications of the same topics and the conference papers, the advantages the
researcher got from this type of data is that, it is less expensive and time saving
(Hodges & Video, 2005).
3.9. Data Collection Methods
This includes both methods and the procedures that the researcher used in collecting
data from the study, the following are the types of data collection methods that were
used.
32
3.9.1 Questionnaire
Questionnaires were designed in such a manner that it was easy for the researcher to
get the right information from the respondents, and also being easy for the
respondents to answer the asked questions without any misunderstandings or errors.
The questionnaire method is widely used by the researcher to obtain enough data
from the large sample, so the data collection method is adopted by both private
individuals, research workers, private and public organization and the government at
large. (Kothari, 2004).
The method of data collection where the researcher structures questions then submits
them to the respondents to fill the needed information, the researcher should
structure/prepare questions that are answered, and they can be in terms of open and
closed ended questions (Kaufman, 2005).The close ended questions are the ones that
do not give a respondent the wide field to express their opinions (precise and
definite), unlike the open ended questions where there is a room to express
opinions.Hence the researcher employed the use of closed ended questionnaires to
get the information needed, the questionnaires were prepared in a written form and
were all submitted to the 80 respondents, and the respondents were required to circle
the appropriate answer, english language was used in drafting questions and the
respondents were asked to return on the appropriate time. The method was used as it
is more reliable and flexible.
3.9.2 Documentary Review
This is the most recommended secondary source of data collection where the
information is collected through the published and unpublished sources that is within
and outside the organization, on this method the researcher reads various documents
relating to the matter under the study so as to obtain the relevant information
(Kothari, 2004). The researcher has used the company website, professional journals
concerning Logistics activities and the supplier-customer relationship, guiding
books and other reports that are related to the topic of the study such as companies
transportation and warehousing Journals and Company material requisition
templates.
33
3.10.1 Data Processing
Data processing is the process of preparing all the data ready for making
comparisons between the expected and analysis (Hair et al, 2009), Where the process
involves analysis (editing, coding, classifications and tabulation of raw data for
making analysis). Editing was done with a very careful review of the whole
questionnaire to find whether the data are correct, and reliable with other facts
gathered, and if the respondents effectively followed the instructions given to them.
Tabulation involved orderly presentation of findings in terms of tables, to reduce
explanatory, descriptive statement and facilitate comparison.
3.10.2 Data Analysis
According to Megahed (2005), identified the term data analysis as examining what
has been collected in the survey and experiment in making deductions and
inferences.
In order to analyze the data which was collected in the field, the researcher
employed the use of quantitative data analysis tool such as Questionnaires due to the
quantitative nature of the study, and the program used was SPSS version 21 as it
involved direct analysis of numerical data and place them in a meaningful statement
which enabled the researcher to employ descriptive statistics to analyze and draw
conclusion and recommendations. Descriptive analysis was used to examine the
ordinal Likert scale data and indicate to what extent does inbound and outbound
logistics activities affect customer -supplier relationship, (the scales that were used
are strongly disagree, disagree, neutral, agree and strongly agree.
Data entry, coding and data cleaning was the initial steps before the researcher
jumped for analysis, where of analytical process the nature of the study and type of
data was the major aspects to be considered (Hair et al, 2009).
3.10.3 Descriptive Analysis
Descriptive statistics are a group of statistical methods used to summarize, describe
or display quantitative data (Collis &Hussey, 2009). Data that were collected from
the sample was analyzed by means of descriptive statistical methods. The standard
34
deviation and the mean were tested from the questions related to inbound logistics
and outbound logistics. This was done to analyze the distribution of the answers
around the mean to understand the similarity of the responses.
3.10.4 Pearson Correlation Coefficient Test
The Pearson correlation coefficient test was used to measure the strength of the linear
relationship between two variables where it showed up direction, strength and
significant relationship among variables, from 0.00 to 1.00 where, when the were
0.00, it means there is no correlation between the variables, while when the value
were 1.00 means there is a perfect correlation, hence we rejected Ho when P value is
less than 0.01 and Accept when P value is higher than 0.01.
Table 3.1: Correlation Coefficient Ranges Correlation coefficient range Strength of association 0.0 - ± 0.19 Very slight, almost negligible ± 0.2 - ± 0.39 Slight but definite relationship ± 0.4 - ± 0.59 Moderate relationship ± 0.6 - ± 0.79 Strong relationship ± 0.8 - ± 1.000 Very strong relationship
Source: Hair et al. 2009
3.10.5 Multiple Regression Analysis
The technique was used to analyze the data for the objective number one to four,
whereby the model showed the influence of each independent (Material Handling,
Warehousing, Transportation and Distribution) variable to the dependent variable
(Supplier-Customer relationship)
The regression model for the study was as follows
Y=β0+β1X1+β2X2+ β3X3 + β4X4 + ε
Y= Dependent Variable (Supplier-Customer Relationship)
Where: Beta (β0) is the constants
(β1, β2, β3, β4) are regression coefficients
X1 =Material Handling Activities
X2 =Warehousing Activities
X3 =Transportation Activities
35
X4 =Distribution Activities
ԑ = error term
3.11 Reliability and validity
3.11.1 Reliability
Kothari (2004) defines reliability as the extent to which data collection methods
yield consistent results, hence the research will be reliable if it is free from
measurement errors since the more the errors the less the reliability of the tested
information (Newman, 2003). The researcher ensured the reliability by comparing
the answers provided from different data collection methods and reviewing
information from the reliable sources on the same topic under study. Hence the
researcher found the repeats from the measures.
Reliability was tested using the Cronbachs Alpha that is a measure of internal
consistency of an instrument to determine if all the areas within the subscales were
related, the alpha coefficient ranges from 0-1 (the closer the scale is to 1, the greater
the reliability of the instrument, the study was more reliable as the overall study
attained an Alpha Coefficient of 0.871 that is 87.1% when converted into percentage
as shown in the below table.
Table 3.2: Reliability Statistics
Cronbach's Alpha N of Items .871 41
3.11.2 Validity
Validity is defined as the extent to which an instrument measure what is supposed to
measure (Aeker, et al, 2002). Content validity was used as the questions asked in the
questionnaires were relevant to the content being measured, also the information was
collected from the right personnel who were directly related to the topic in hand. The
questionnaires were also reviewed by the supervisor to check its validity and
crosscheck was made in the different collection methods.
36
3.12 Measurement Of Variables
To operationalize the research variables, the study first determined the parameters of
each independent variable and then employs an ordinal scale which was the Likert
scale, to measure the independent variables. Non–parametric method involves
nominal and ordinal, where in this study, the researcher use non–parametric method
in which this approach nominal and ordinal data were used to express information.
As shown on the table below.
3.13 Research Ethics
According to Sillivan (2001), argues that, research is bonded to ethical consideration
during the process of conducting their study, hence, the researcher has observed all
the rights of the respondents, including their safety, information given out by
respondents has been kept confidential and secretive to avoid any harming to
respondents, thus the researcher has respected the confidentiality of the respondents
so as to make them provide more information and try to avoid them hide the
information.
37
CHAPTER FOUR
PRESENTATION OF FINDINGS AND ANALYSIS
4.1 Introduction
The chapter presents the findings and data that were collected both primary and
secondary as per the research objectives, the chapter starts to present the
demographic information from the study that is age, gender and education, from the
respondents then after the analysis of other variables will be presented.
4.2 General Information For The Respondents
The section has been included by the researcher to show the demographic
information from the respondents as per their age, gender and education so as to
ensure the reliability of the collected information.
4.2.1 Response Rate
The study had a total number of 80 respondents who fully participated in making the
filling of questionnaires done, lucky enough, all the questionnaires were well filled
and returned to the researcher for the analysis to take place, all this is due to the
efforts the researcher made on keeping more emphasize to the respondents to answer
the provided questionnaires on specified time.
Table 4.1: Response rate of respondents (N=80) Department No of
questionnaires provided
No of questionnaires returned
%
Procurement officers 10 10 12.5 Stores and warehousing officers 25 25 31.25 Transportation and distribution 25 25 31.25 Customers 10 10 12.5 Suppliers 10 10 12.5 Total 80 80 100
Source: Field data (2020)
4.2.2 Age Of The Respondents
The first variable that was to be filled by the respondents was age, as the researcher
was much aware of most of the respondents being reluctant to expose their actual
38
ages, so the researcher decided to combine them in groups and the respondents were
to tick only one group of their range where their ages belong.
Table 4.2: Age Distribution Of Respondents (N=80
Source: Field data (2020)
Table 4.2 shows that, , majority of the respondents were aged from 26-30 Years who
make a total of 28(35%), then followed with the group of 21-25 who were
18(22.5%) and 31-35 18(22.5%) Years who both make a total of 45%, the third
group is a group of 36-40 Years who make a total of 10(12.5%), then followed by a
group of 41-45 years who make a total of 3.8%, then a group of 18-20 years who
make a total of two (2.5%) and the last group 45 years and above who only made a
total of 1.3% out of 100%. Hence all the respondents had 18 years and above, that is
they are all matured to understand and answer the given questions and only fewer
respondents that (1.3%) were above 45 Years and this is mostly due to the reason as
most of the private and reputable companies like COCACOLA prefer to hire young
and energetic people who can fit to the current competitive market.
4.2.3 Gender Of Respondents
The second variable that was to be filled by the respondents was gender, where from
a total of 80 respondents, 39 respondents were female, who made a total of 48.8%
and the remaining 41 respondents were Male, who made a total of 51.2% out of
100%, hence the researcher has observed the gender balance on getting the
information about the title on the study as shown from the table below.
Age category (years) f % 18-20 2 2.5 21-25 18 22.5 26-30 28 35.0 31-35 18 22.5 36-40 10 12.5 41-45 3 3.8 Above 45 1 1.3 Total 80 100
39
Table 4.3: Gender Distribution of respondents (N=80)
Source: Field data (2020)
4.2.4 Education Level Of The Respondents
The education category variable was so necessary for the researcher and the study in
general, as the researcher needed the respondents who has enough knowledge and
understandings about inbound and outbound logistics thing that could enable the
researcher analyze and conclude well the study.
Table 4.4: Education Level Of Respondents (N=80)
Source: Field data (2020)
Findings in Table 4.4 indicate that 36(45%) respondents were Bachelor degree
holders, while 20(25%) respondents were Diploma holders. On the other hand,
12(15%) respondents were holders of Master degree, whereas nine (11.2%) were
Certificate holders and three (3.8%) were holders of an Advanced level of secondary
education.
All the respondents that have been involved in answering the questionnaire have
enough academic qualification that is needed by the researcher as most of them hold
the Advanced level of education and above, hence the literacy rate of the respondents
were good and convincing.
Gender f % Female 39 48.8 Male 41 51.2 Total 80 100
Education level f % A-level 3 3.8 Certificate 9 11.2 Diploma 20 25 Bachelor 36 45 Masters 12 15 Total 80 100
40
After presenting the general information data, the researcher now presents the
findings from each Objective as per the respondents answers, the findings will first
be presented in a descriptive form where the researcher has focus on the mean and
the standard deviation to see if the questions on each objective was agreed or not,
then the researcher will present Pearson correlation to show the strength of the
relationship on which each independent variable has to the dependent variable, then
after Multiple regression will also be presented to see on what extent does the
independent variable contributes or influences the dependent variable, the last step
with this chapter, the researcher will Test the hypothesis that were previous
formulated in chapter 3 to see if they are accepted or rejected, here under are the
presentation of descriptive statistics
Table 4.5: Material Handling Logistics On Supplier-Customer Relationship
(N=80)
Source: Field data (2020)
Variable SD D N A SA Mean Std dev. f % f % f % f % f %
Shorter operating circle impacts the supplier - customer relationship
2
2.4
4
4.8
18
21.7
43
51.8
13
15.7
3.76
.875
Proper material handling reduces the handling cost
0
0
5
6
7
8.4
39
47
29
34.9
4.15
.828
Better customer care impacts the supplier - customer relationship
2
2.4
4
4
17
20.5
36
43.4
21
25.3
3.88
.946
Material handling facilitate better quality
2
2.4
1
1.2
11
13.3
32
38.6
34
41
4.19
.901
Material handling facilitates timely production
0
0
3
3.6
11
13.3
36
43.4
30
36.1
4.16
.803
Proper packaging of material and products
0
0
2
2.4
17
20.5
36
43.4
25
30.1
4.05
.794
Proper inspection of material
1
1.2
4
4.8
6
7.2
31
37.3
38
45.8
4.26
.896
41
4.3 Descriptive Analysis
From 4.4 above material handling activities had a total of seven(7) sub objectives
questions, the first question that was about “Shorter operating circle impacts the
supplier-customer relationship” it had a mean of 3.76 and the standard deviation of
0.875 where (13) 15.7% Strongly Agreed, 43 (51.8%) agreed, (18) 21.7% remained
Neutral, while (4)4.8% Disagree and the remaining(2) 2.4% strongly Disagree, hence
this shows most of the respondents agreed.
The second sub-question was” Proper material handling reduces the handling cost”
where it had a mean of 4.15 which implies that most of the respondents have Agreed
as the mean is above Average and the standard deviation of 0.828, (29)34.9%
Strongly Agreed, (39)47%Agreed, (7)8.4% remained Neutral while (5)6% Disagreed
and none of them Strongly disagreed hence this implies that most of of the
respondents agreed.
The third subquestion was”Better customer care impacts the supplier - customer
relationship” the question had a mean of 3.88 which implies that most of the
respondents have Agreed as the mean is above Average and the standard deviation
of 0.946 of which 25.3% Strongly Agreed, 43.4% agreed, 20.5% remained Neutral
while 4% Disagreed and the remaining 2.4% strongly disagreed, hence this implies
that most of the respondents agreed.
The fourth subquestion was” Material handling facilitate better quality” which had a
mean of 4.19 which implies that most of the respondents have Agreed as the mean is
above Average and the standard deviation of 0.901 in which 41% Strongly agreed,
38.6% Agreed, 13.3% remained Neutral, while1. 2% Disagreed and the remaining
2.4% Strongly Disagreed, this shows that most of the respondents Agreed that
material handling facilitate better quality hence impacts the supplier - customer
relationship.
The fifth question was” Material handling facilitates timely production” where it had
a mean of 4.16 which implies that most of the respondents have Agreed as the mean
42
is above Average and the standard deviation of 0.803 were 36.1% Strongly Agreed,
43.4% Agreed, 13.3% remained Neutral while 3.6% Disagree and none of the
respondents Strongly Disagree hence implies that it was mostly agreed.
The sixth Question was” Proper packaging of material and products” it had a mean
of 4.05 which implies that most of the respondents have Agreed as the mean is above
Average and the standard deviation of 0.794 were 30.1% Strongly Agreed, 43.4%
agreed, 20.5% remained Neutral while 2.4% Disagree and none of them Strongly
disagree.
The seventh question was” Proper inspection of material impacts the supplier-
customer relationship” the question had a mean of 4.26 which implies that most of
the respondents have Agreed as the mean is above Average and the standard
deviation of 0.896 were 45.8% Strongly Agreed, 37.3% Agreed, 7.2%remained
Neutral while 4.8 Disagreed and the remaining 1.2 strongly disagreed.
43
Table 4. 6: Warehouse Activities On Supplier-Customer Relationship (N=80)
Source: Field data (2020)
From table 4.5 above, it shows the impact of warehousing activities on the supplier-
customer relationship, where the objective had a total of seven (7) questions as
displayed from the table.
The first subquestion was “Warehouse personnel serve our customers at reasonable
times”where it had a mean of 4.23 which implies that most of the respondents have
Agreed as the mean is above Average and the standard deviation of 0.900, where
42.5% Strongly Agreed, 46.3% Agreed, 5.0% remained Neutral while 3.8 Disagreed
and the remaining 2.5% Strongly Disagreed.
The second question was” Cargo available to customers on time after they have
arrived in the warehouse” it had a mean of 4.08 which implies that most of the
Variable SD D N A SA Mean Std dev. f % f % f % f % f %
Warehouse personnel serve our customers at reasonable times
2
2.5
3
3.8
4
5.0
37
46.3
34
42.5
4.23
.900
Cargo available to customer after arrival
2
2.5
2
2.5
13
16.3
34
42.5
29
36.1
4.08
.925
Proper warehouse management minimizes total carrying cost
2
2.5
4
5
8
10
42
53
24
30
4.03
.914
Proper warehouse management minimizes product damage
0
0
2
2.5
9
11.3
35
43.8
34
42.5
4.26
.759
SOP in warehouse helps in providing security
1
1.3
4
5.0
17
21.3
30
37.5
28
35.0
4.00
.941
Proper location reduces customer waiting time
1
1.3
2
2.5
14
17.5
43
53.8
20
25.0
3.99
.941
Items on lines picked accurately as per customer orders
0
0
2
2.5
9
11.3
38
47.5
31
38.8
4.23
.746
44
respondents have Agreed as the mean is above Average and the standard deviation
of 0.925 were 36.1% Strongly Agreed, 42.5% Agreed, 16.3% remained Neutral
while 2.5% Disagreed and the remaining 2.5% Strongly disagreed.
The third question was” Proper warehouse management minimizes total carrying
cost” the question had a mean of 4.03 which implies that most of the respondents
have Agreed as the mean is above Average and the standard deviation of 0.914 were
30% Strongly Agreed, 53% Agreed, 10% remained Neutral while 5% Disagreed and
the remaining 2.5% Strongly Disagreed.
The forth question was” Proper warehouse management minimizes product damage”
the question had a mean of 4.26 which implies that most of the respondents have
Agreed as the mean is above Average and the standard deviation of 0.759 were
42.5% Strongly Agreed, 43.8% Agreed, 11.3% remained Neutral while 2.5%
Disagreed.
The fifth question was” SOP in warehouse helps in providing security” the question
had a mean of 4.00 which implies that most of the respondents have Agreed as the
mean is above Average and the standard deviation of 0.941 were35.0% Strongly
Agreed, 37.5% Agreed, 21.3 remained Neutral while 5.0% Disagreed and the
remaining 1.3% Strongly Disagreed.
The Sixth Question was” Proper location reduces customer waiting time” where it
had a mean of 3.99 which implies that most of the respondents have Agreed as the
mean is above Average and the standard deviation of 0.941, were 25% Strongly
Agreed, 53.8% Agreed, 17.5% Remained Neutral, while 2.5% Disagreed and the
remaining 1.3% Strongly Disagreed.
The seventh question was” Items on lines picked accurately as per customer orders”
the question had a mean of 4.23 which implies that most of the respondents have
Agreed as the mean is above Average and the standard deviation of 0.746 were 38.8
Strongly Agreed, 47.5 Agreed, 11.3 remained Neutral while 2.5% disagreed.
45
Table 4. 7: Transportation Activities on supplier-customer relationship (N=80)
Variable SD D N A SA Mean Std dev. f % f % f % f % f %
Transportation system provides efficiency in logistics
1
1.3
2
2.5
8
10.0
32
40
37
46.3
4.28
.842
Transportation system helps the company reach its economies of scale
1
1.3
2
2.5
7
8.8
36
45
34
42.5
4.25 .819
The overall quality of companies is very high
1
1.3
2
2.5
6
7.5
32
40
39
48.8
4.33
.823
The company transportation service is cost efficient
1
1.3
0
0
9
11.3
42
52.5
28
35.0
4.20
.736
Transportation service of the company is flexible
0
0
4
5.0
12
15
46
57.5
18
22.5
3.98
.763
Transportation service of the company provides quick response
0
0
0
0
12
15
48
60
20
25.0
4.10 .628
Transportation cost is very competitive compared to market
1
1.3
2
2.5
13
16.3
35
43.8
29
36.3
4.11 .857
Transportation system ensures safety and timely delivery
1 1.3 0 0 13 16.3 40 50 26 32.5 4.13 .769
Employee performance, inadequate training, lack of understanding
2 2.5 2 2.5 4 5 37 46.3 35 43.8 4.26 .868
Lack of adequate modern equipment, infrastructure problem
1 1.3 2 2.5 4 5 38 47.5 35 43.8 4.3 .789
Source: Field data (2020)
From table 4.6 above displays the subquestions from the objective number 3 that is
the impact of transportation activities on the supplier-customer relationship. The
objective had a total number of ten questions (10) as follows
The first question was” Transportation system provides efficiency in logistics” where
it had a mean of 4.28 which implies that most of the respondents have Agreed as the
mean is above Average and the standard deviation of 0.842, were 46.3% Strongly
Agreed, 40% Agreed, 10% remained Neutral while 2.5% Disagreed and the
remaining 1.3% Strongly Disagreed.
The second question was” Transportation system helps the company reach its
economies of scale” it had a mean of 4.25 which implies that most of the respondents
46
have Agreed as the mean is above Average and the standard deviation of 0.819,
were 42.5% Strongly Agreed, 45% Agreed, 8.8% remained Neutral while 2.5%
Disagreed and the remaining 1.3% Strongly Disagreed.
The third question was” The overall quality of companies is very high, hence impacts
the supplier-customer relationship”the question had a mean of 4.33 which implies
that most of the respondents have Agreed as the mean is above Average and the
standard deviation of 0.823 where 48.8% Strongly Agreed, 40% Agreed, 7.5%
remained Neutral while 2.5% Disagreed and the remaining 1.3% Strongly Disagreed.
The fourth question was” The company transportation service is cost efficient”the
question had a mean of 4.2 which implies that most of the respondents have Agreed
as the mean is above Average and the standard deviation of 0.736 where 35%
Strongly Agreed, 52.5% Agreed, 11.3% remained Neutral while 1.3% Strongly
Disagreed.
The fifth question was “Transportation service of the company is flexible”the
question had a mean of 3.98 which implies that most of the respondents have Agreed
as the mean is above Average and the standard deviation of 0.763, were 22.5%
Strongly Agreed, 57.5% Agreed, 15% remained Neutral while 5% Agreed.
The sixth question was” Transportation service of the company provides quick
response” the question had a mean of 4.10 which implies that most of the
respondents have Agreed as the mean is above Average and the standard deviation
of 0.628 were 25% Strongly Agreed, 60% Agreed, while the remaining 12%
remained Neutral.
The seventh question was” Transportation cost is very competitive compared to
market”the question had a mean of 4.11 which implies that most of the respondents
have Agreed as the mean is above Average and the standard deviation of 0.857
where 36.3% Strongly Agreed, 43.8% Agreed, 16.3% remained Neutral while 1.3%
Strongly Disagreed.
The Eighth question was” Transportation system ensures safety and timely delivery”
the question had a mean of 4.13 which implies that most of the respondents have
47
Agreed as the mean is above Average and the standard deviation of 0.769,
where32.5% Strongly Agreed, 50% Agreed, 16.3% remained Neutral, while 1.3%
Strongly Disagreed.
The Ninth Question was” Employee performance, inadequate training, lack of
understanding are the major challenges in transportation activities, hence impacts the
supplier-customer relationship.” The question had a mean of 4.26 which implies that
most of the respondents have Agreed as the mean is above Average and the standard
deviation of 0.868, where 43.8% Strongly Agreed, 46.3% Agreed, 5% remained
Neutral while 2.5% Disagreed and the remaining 2.5% Strongly Disagreed.
The last question of the objective was” Lack of adequate modern equipment,
infrastructure problem are the non-human challenges that affect transportation
operation” the question had a mean of 4.3 which implies that most of the respondents
have Agreed as the mean is above Average and the standard deviation of 0.789,
where 43.8 Strongly Agreed, 47.5 Agreed, 5% remained Neutral, while 2.5%
Disagreed and the remaining 1.3% Strongly Disagreed.
48
Table 4. 8: Distribution Activities On Supplier-Customer Relationship (N=80) Variable SD D N A SA
f % f % f % f % f % Units ordered by customers are fully distributed
2
2.5
3
3.8
7
8.8
37
46.3
31
38.8
Orders are consistently distributed to the right customers
2
2.5
0
0
7
8.8
40
50
31
38.8
Goods distributed to the customers at the right time
0
0
4
5
5
6.3
39
48.8
32
40
The distribution sector order policies are flexible enough to permit timely response to the market demand
1 1.3 3 3.8 12 15 39 48 25 31.3
The Distribution team responds timely to special request and needs of customers
0 0 1 1.3 10 12.5 40 50.0 29 36.3
The units distributed to the customers are correct and exactly as specified
0
0
2 2.5 5 6.3 38 47.5 35 43.8
The average delivery time is reliable, this impacts the supplier-customer relationship
0 0 2 2.5 8 10 45 56.3 25 31.3
The Products are always distributed as promised, hence impacts the supplier-customer relationship
0 0 5 6.3 7 8.8 43 53.8 25 31.3
The damage in transit is minimum hence the
2 2.5 3 3.8 8 10.0 36 45 31 38.8
Goods are well inspected before distribution, hence impacts the supplier-customer relationship.
1 1.3 2 2.5 4 5.0 38 47.5 35 43.8
Source: Field data(2020)
Table 4.7 above displays the findings of objective number four”the impact of
distribution activities on the supplier-Customer relationship, the objective had a total
of 10 questions as explained below.
The first question was” Units ordered by customers are fully distributed” the
question had a mean of 4.3 and the standard deviation of 0.786 where 38.8%
Strongly Agreed, 46.3% Agreed, 8.8% remained Neutral while 3.8% Disagreed and
the remaining 2.5% Strongly Disagreed.
49
The Second question was” Orders are consistently distributed to the right customers”
the question had a mean of 4.33 and the standard deviation of 0.708 where 38.8%
Strongly Agreed, 50% Agreed, 8.8% remained Neutral while the remaining 2.5%
Strongly Disagreed.
The third question was” Goods distributed to the customers at the right time”the
question had a mean of 4.23 and the standard deviation of 0.811 where 40% Strongly
Agreed, 48.8 Agreed, 6.3% remained Neutral while 5% Disagreed.
The fourth question was” Average delivery time is reliable”the question had a mean
of 4.10 and standard deviation of 0.805 where 31.3% Strongly Agreed, 56.3%
Agreed, 10% remained Neutral while 2.5% Disagreed.
The fifth question was” The Products are always distributed as promised”the
question had a mean of 4.16 and the standard deviation of 0.702 where 31.3%
Strongly Agreed, 53.8% Agreed, 8.8% remained Neutral while 6.3% Disagreed.
The Sixth question was” Damage in transit is minimum hence the quality of goods
are well maintained” the question had a mean of 4.24 and the standard deviation of
0.783 where 38.8% Strongly Agreed, 45% Agreed, 10% remained Neutral while
3.8% Disagreed and 2.5% Strongly Disagreed.
The Seventh question was” The units distributed to the customers are correct and
exactly as specified hence impacts the supplier-customer relationship” the question
had a mean of 4.14 and the standard deviation of 0.924 where 43.8% Strongly
Agreed, 47.5% Agreed, 6.3% remained Neutral while 2.5% Disagreed.
The Eighth question was “The Distribution team responds timely to special request
and needs of customers, hence has an impact on the supplier-customer
relationship”where 36.3% Strongly agree, 50% Agreed 12.5% remained Neutral
while 1.3% Disagreed.
The Ninth Question was” The distribution sector order policies are flexible enough to
permit timely response to the market demand, hence impacts the supplier-customer
50
relationship”. Where 31.3% Strongly Agreed, 48% Agreed, 15% remained Neutral,
while 3.8 Disagreed and the remaining 1.3% Strongly Disagreed.
The Tenth question was” Goods are well inspected before distribution, hence impacts
the supplier-customer relationship”on this 43.8 Strongly agreed, 47.5 Agreed, 5%
remained Neutral while 2.5% Disagreed and the remaining 1.3% Strongly Disagreed.
Table 4. 9: Supplier-Customer Relationship (N=80)
Variable SD D N A SA Mean Std dev. f % f % f % f % f %
The roles and responsibilities between the supplier and customers are well defined
7
8.8
10
12.5
3
3.8
31
38.8
29
36.3
4.11
.886
The trust and open communication exists between the suppliers and the customers
7
8.8
8
10.0
2
2.5
23
28.8
40
50 4.08 .911
There is a continuous improvements between the suppliers and customers toward the agreed targets
7
8.8
10
12.5
9
11.3
18
22.5
36
45.0
4.06
.946
Customers focus more on The common vision and the agreed targets
0
0
2
2.5
9
11.3
35
43.8
34
42.5
4.26 .759
The needs are well anticipated and creative solutions provided
3
3.8
7
8.8
2
2.5
30
37.5
38
47.5
4.11
.886
On time delivery and payments are done
6
7.5
6
7.5
5
6.3
33
41.3
30
37.5
4.11
.886
Business risk is equally shared 2
2.5
4
5.0
7
8.8
23
2.88
44
55
4.23
.746
Source: Field data (2020)
The above table 4.8 Displays the important factors that affects the Supplier-Customer
relationship, the objective had a total of seven questions (7) as explained below.
The first question was” The roles and responsibilities between the supplier and
customers are well defined” where the question had a mean of 4.11 which implies
that most of the respondents have Agreed as the mean is above Average and the
Standard deviation of 0.886 where 36.3% Strongly Agreed, 38.8% Agreed, 3.8%
remained Neutral while 12.5% Disagreed and the remaining 8.8% Strongly
Disagreed.
51
The second question was” The trust and open communication exists between the
suppliers and the customers”where the question had a mean of 4.08 which implies
that most of the respondents have Agreed as the mean is above Average and the
standard deviation of 0.911 where 50% Strongly Agreed, 28.8 Agreed, 2.5%
remained Neutral while 10% Disagreed and the remaining 8.8% Strongly Disagreed.
The third question was “There is a continuous improvements between the suppliers
and customers toward the agreed targets” the question had a mean of 4.06 which
implies that most of the respondents have Agreed as the mean is above Average and
the standard deviation of 0.946 where 45% Strongly Agreed, 22.5% Agreed, 11.3%
remained Neutral while 12.5% Disagreed and the remaining 8.8% Strongly
Disagreed.
The fourth question was”Customers focus more on The common vision and the
agreed targets”the question had a mean of 4.26 which implies that most of the
respondents have Agreed as the mean is above Average and the standard deviation
of 0.759 where 42.5% Strongly Agreed, 43.8% Agreed, 11.3% remained Neutral
while 2.5% Disagreed.
The Fifth question was” The needs are well anticipated and creative solutions
provided”the question had a mean of 4.11 which implies that most of the respondents
have Agreed as the mean is above Average and the standard deviation of 0.886
where 47.5% Strongly Agreed, 37.5% Agreed, 2.5% remained Neutral while 8.8%
Disagreed and the remaining 3.8% Strongly Disagreed.
The Sixth question was” On time delivery and payments are done”the question had a
mean of 4.11 which implies that most of the respondents have Agreed as the mean is
above Average and the standard deviation of 0.886 where 37.5% Strongly Agreed,
41.3% Agreed, 6.3% remained Neutral while 7.5% Disagreed and the remaining
7.5% Strongly Disagreed.
The last seventh question was” Business risk is equally shared”the question had a
mean of 4.23 which implies that most of the respondents have Agreed as the mean is
above Average and the standard deviation of 0.746 where 55% Strongly Agreed,
52
2.88% Agreed, 8.8% remained Neutral while 5% Disagreed and the remaining 2.5%
Strongly Disagreed.
4.4 Pearson Correlation Analysis
The analysis is defined as a measure of linear association between the independent
and the dependent variables, the analysis is used to show the strength, significance
and the direction of the relationship that is whether it is negative, positive or no
correlation at all, through Pearson correlation analysis we usually assume that , the
variable data should normally be distributed and the variables should be continuous
that is the scale of measurement should be intervals and the ratios example time,
height, age and the other alike (Hairs et al 2009).
In determining the kind of the relation the independent and dependent variable has,
we look at the p-value, and on determining the strength and the direction of the
relationship we observe the correlation coefficient value. P-value that is less than the
alpha value 0.05 implies a significant relationship between the variables and the p-
value that is greater than 0.05 implies the absence of relationship (Hairs et al 2009).
Explaining about the correlation coefficient is, the values usually lie between 0.00
and 1.00, where the closer the value is to 1.00 the more variables seem to have a
strong relationship, and if the values are closer to 0.00 we subject the relationship
between the variables to be weak.
On below table 4.9 the researcher has shown the correlation coefficient ranges and
their interpretations and the strength of associations and table 4.10 we shall see
correlation coefficient from the analysis.
Table 4. 10: Correlation Coefficient Ranges Correlation coefficient range Strength of association 0.0 - ± 0.19 Very slight, almost negligible± 0.2 - ± 0.39 Slight but definite relationship ± 0.4 - ± 0.59 Moderate relationship ± 0.6 - ± 0.79 Strong relationship ± 0.8 - ± 1.000 Very strong relationship
Source: Hair et al. 2009
53
Table 4. 11: Correlations
Handling_
Materials
Warehous
e_Manage
ment
Transportatio
n_Manageme
nt
Distribution
_Managem
ent
Supplier_
Customer
Handling_Mate
rials
Pearson
Correlation
1
Sig. (2-tailed)
N 80
Warehouse_Ma
nagement
Pearson
Correlation
.376** 1
Sig. (2-tailed) .001
N 80 80
Transportation_
Management
Pearson
Correlation
-.024 .252* 1
Sig. (2-tailed) .831 .024
N 80 80 80
Distribution_M
anagement
Pearson
Correlation
.507** .354** .068 1
Sig. (2-tailed) .000 .001 .551
N 80 80 80 80
Supplier_Custo
mer
Pearson
Correlation
.551** .244* -.006 .936** 1
Sig. (2-tailed) .000 .029 .955 .000
N 80 80 80 80 80
**. Correlation is significant at the 0.01 level (2-tailed).
*. Correlation is significant at the 0.05 level (1-tailed).
Source: Field data (2020)
The above table shows correlation coefficient between the independent and the
dependent variables that is material handling, warehousing, transportation and
54
distribution activities and the dependent variable being the supplier-customer
relationship.
4.4.1 Material Handling And Supplier-Customer Relationship
Table 4.10 shows,that there is a significant relationship between material handling
and the supplier-customer relationship by observing on the p-value 0.000 that is less
than the alpha value 0.05, on deciding the strength of of relationship between
material handling and the supplier-customer,the correlation presents that there is a
moderate relationship between the variables that lies between ± 0.4 - ± 0.59 from the
correlation coefficient ranges table 4.9 and the researcher analysis presents 0.551 as
shown in table 4.10 above.
4.4.2 Warehouse Management And Supplier-Customer Relationship
Table 4.10 shows shows that,there is a significant relationship between warehouse
management and the supplier-customer relationship by observing on the p-value of
0.029 that is less than the alpha value 0.05, on deciding the strength of of relationship
between warehousing management and the supplier-customer,the correlation
presents that there is a Slight but definite relationship between the variables that lies
between ± 0.2 - ± 0.39 from the correlation coefficient ranges Table 4.9 and the
researcher analysis presents 0.244 as shown in table 4.10 above.
4.4.3 Transportation Management And Supplier-Customer Relationship
Table 4.10 shows that, there is an absence of significant relationship between
Transportation management and the supplier-customer relationship by observing on
the p-value of 0.955 that is greater than the alpha value 0.05, on deciding the strength
of the relationship between warehousing management and the supplier-customer, the
correlation presents that there is a negative relationship between the variables of -006
correlation coefficient ranges.
4.4.4 Distribution Management And Supplier-Customer Relationship
Table 4.10 shows shows that, there is a significant relationship between Distribution
management and the supplier-customer relationship by observing on the p-value of
55
0.000 that is less than the alpha value 0.05, on deciding the strength of relationship
between Transportation management and the supplier-customer, the correlation
presents that there is a very Strong relationship between the variables that lies
between ± 0.8 - ± 1.000 from the correlation coefficient ranges Table 4.9 and the
researcher analysis presents 0.936 as shown in table 4.10 above.
4.5 Multiple Regression Analysis
The analysis is the extension of simple linear analysis, where is is used when the
researcher wants to predict more than two variables (Hairs et al 2009).In the study
researcher has used the standard Multiple regression analysis as all the independent
variables were combined together to show how they influence the dependent variable
.
4.5.1 Model Summary
The model summary shows the extent to which the dependent variable (Supplier-
Customer relationship) is well or less explained by the independent variable (material
handling, warehousing, transportation and distribution)
In the table below the R square is 0.899 which implies that all the independent
variables explains of the dependent variable by 89.9%, only 10.1% remain
unexplained, hence the researcher concluded that the model that was used in
determining the relationship between the independent and dependent variable is very
good.
Table 4. 12: Model Summaryb
Model R R Square Adjusted R Square
Std. Error of the Estimate
Durbin-Watson
1 .948a .899 .893 2.01146 1.691
A. PREDICTORS: (CONSTANT), DISTRIBUTION_MANAGEMENT,
TRANSPORTATION_MANAGEMENT,
WAREHOUSE_MANAGEMENT, HANDLING_MATERIALS
B. DEPENDENT VARIABLE: SUPPLIER_CUSTOMER-
RELATIONSHIP
Source: Field data (2020)
56
4.5.2 Analysis Of Variance (ANOVA)
The analysis of variance (ANOVA) summary table shows the statistical adequacy of
the used model. From table 4.12 below, the p-value / significance level is 0.000
which is less than 0.05 and the F-test result is 166.693. These results show that the
model explains well the dependent variable and model can be generalized in the
entire manufacturing companies in Tanzania
.
Table 4. 13: ANOVAa
Model Sum of Squares df Mean Square F Sig.
Residual 303.448 75 4.046
Total 3001.187 79
A. DEPENDENT VARIABLE: SUPPLIER_CUSTOMER
B. PREDICTORS: (CONSTANT), DISTRIBUTION_MANAGEMENT,
TRANSPORTATION_MANAGEMENT, WAREHOUSE_MANAGEMENT,
HANDLING_MATERIALS
Source: Field data (2020)
4.5.3 Coefficient Results
The table below (coefficient result) explains by how much each independent
variable(material handling, warehousing, Transportation and Distribution) predict
the depend variable(Supplier-Customer relationship), being standardized and
unstandardiized coefficient, the researcher will the significant(p-value) will also be
used to determine the relationship.
57
Table 4.13 Coefficientsa
Model Unstandardized Coefficients Standardized Coefficients
t Sig.
B Std. Error Beta
1
(Constant) -7.309 3.220 -2.270 .026 Material Handling .264 .088 .132 2.989 .004 Warehouse activities -.261 .091 -.121 -2.880 .005 Transportation activities -.053 .058 -.035 -.904 .369 Distribution activities .919 .044 .914 20.990 .000
a. DEPENDENT VARIABLE: SUPPLIER_CUSTOMER
b. INDEPENDENT VARIABLE: MATERIAL HANDLING, WAREHOUSE
MANAGEMENT, TRANSPORTATION MANAGEMENT AND
DISTRIBUTION.
Source: Field data (2020)
4.5.3.1 The Influence Of Material Handling Activities On The Supplier-
Customer Relationship
From table 4.13 above, it shows that material handling has a positive contribution to
the supplier- customer relationship as the significant 0.004 is less than 0.05, also
material handling activities explains better the supplier-Customer relationship since it
has a positive beta coefficient of 0.264, this means that if the material handling
activities are well improved, it will lead to an increase in Supplier-Customer
relationship by 0.264.
4.5.3.2 The Influence Of Warehousing Activities On The Supplier-Customer
Relationship
From table 4.13 above, it shows that warehousing activities have a positive
contribution to the supplier- customer relationship as the significant 0.005 is less than
0.05, warehousing activities has a beta of -0.261, this means that although the
warehousing activities improve in any how it will lead to the decrease of Supplier-
Customer relationship by 0.261
58
4.5.3.3 The Influence Of Transportation Activities On The Supplier-Customer
Relationship
From table 4.13 above, it shows that transportation activities have a negative
contribution to the supplier- customer relationship as the significant 0.369 is greater
than 0.05, transportation activities has a beta of -0.053, this means that no matter the
improvement of Transportation activities it will lead to the decrease of Supplier-
Customer relationship by 0.053.
4.5.3.4 The Influence Of Distribution Activities On The Supplier-Customer
Relationship
From table 4.13 above, it shows that distribution activities have a positive
contribution to the supplier- customer relationship as the significant 0.000 is less than
0.05, also distribution activities explains better the supplier-Customer relationship
since it has a positive beta coefficient of 0.919, this means that if the distribution
activities are well improved, it will lead to an increase in Supplier-Customer
relationship by 0.919.
4.5.4 Summaries Of The Regression Analysis Findings
As all the other factors remaining constant, among four objectives, two objectives
that are material handling and distribution activities have a positive contribution to
the dependent variable (Supplier-Customer relationship) while the remaining two
objectives (warehousing activities and transportation) have a negative contribution to
the dependent variable.
Figure 4. 1: New Regression Equation Independent Variables
The above findings can be simplified and projected to the regression equation as
follows
Y= -7.309 + (0.264X1) + (-0.261X2) + (-0.053X3) + (0.919X4)
Y= Dependent Variable (Supplier-Customer Relationship)
Where: Beta (β0) is the constant
(β1, β2, β3, β4) are regression coefficients
X1 =Material Handling Activities
59
X2 =Warehousing Activities
X3 =Transportation Activities
X4 =Distribution Activities
4.6 Hypothesis Testing
The hypothesis that were prepared and talked about in chapter two (2), they are now
being tested using the regression output presented in table 4.13 above, the hypothesis
that were prepared were,
H1: There is a relationship between Material Handling Activities and Supplier-
Customer Relationship
H2:There is a relationship between Warehousing Activities and Supplier-Customer
Relationship
H3:There is a relationship between Transportation Activities and Supplier-Customer
Relationship
H4:There is a relationship between Warehousing Activities and Supplier-Customer
Relationship.
In testing the hypothesis the researcher concentrated mainly on the significant value
(p-value) and the unstandardized beta coefficient to find out if the hypothesis is to be
Accepted or Rejected and also the direction of the relationship between the variables.
The researcher will accept the hypothesis if it is less than 0.05 and if the coefficient
will produce the same results as what the researcher predicted in hypothesis, unless
otherwise they will be rejected.
4.6.1: There Is The Relationship Between Material Handling Activities And
Supplier-Customer Relationship (H1)
From table 4.13 above, it shows that material handling has a positive relationship to
the supplier- customer relationship as the significant 0.004 is less than 0.05, also
material handling activities explains better the supplier-Customer relationship since it
has a positive beta coefficient of 0.264, hence H01 is accepted.
60
4.6.2: There Is The Relationship Between Warehousing Activities And Supplier-
Customer Relationship (H2)
From table 4.13 above, it shows that warehousing activities have a positive
relationship to the supplier- customer relationship as the significant 0.005 is less than
0.05. Warehousing activities has a beta of -0.261 which means warehousing
activities has a negative influence to supplier-customer relationship, this means that
the hypothesis (H02) has been accepted.
4.6.3: There Is The Relationship Between Transportation Activities And
Supplier-Customer Relationship (H3)
From table 4.13 above, it shows that transportation activities have no significant
relationship to the supplier- customer relationship as the p-value 0.369 which is
greater than 0.05. The variable (transportation) activities has a beta of -0.053 and this
means that the hypothesis three (H03) have been rejected.
4.6.4: There Is The Relationship Between Distribution Activities And Supplier-
Customer Relationship (H4)
From table 4.13 above, it shows that distribution activities have a positive
relationship to the supplier- customer relationship as the significant 0.000 is less than
0.05, also distribution activities explains better the supplier-Customer relationship
since it has a positive beta coefficient of 0.919, hence H04 has been accepted.
Table 4. 14: Summary Of The Tested Hypotheses Hypothesis Independent
variable Dependent variable Sig value Status
H1 Material handling Supplier-Customer relationship
0.004 Accepted
H2 Warehousing activities
Supplier-Customer relationship
0.005 Accepted
H3 Transportation activities
Supplier-Customer relationship
0.369 Rejected
H4 Distribution Activities
Supplier-Customer relationship
0.000 Accepted
Source: Field data (2020)
61
CHAPTER FIVE
DISCUSSION OF FINDINGS
5.1 Introduction
This chapter presents the discussion of findings that were made in the previous
chapter, the discussion are according to the objective (specific and general objective),
the researcher has first collected the analysis findings from each objective, the
second is making a comparison with similar findings from different studies and then
discussing the implication of each result.
5.2 Reliability
According to Collins &Hussey (2009), a measuring instrument is subjected to be
more reliable when the end results of the same research yield the same or are
homogeneous, normally the Alpha coefficient ranges from 0-1 and the closer the
scale is to 1 the greater the reliability, hence most of the studies recommends that the
reliability should not be below 0.7, the overall realibility of this study achieved an
alpha coefficient of 0.87, hence this signifies that there is a strong reliability within
the 41 asked questions as shown in table 3.2 above
.
5.3. Discussion Of Demographic Information
5.3.1 Age Of Respondents
Most of the respondents were aged between 21 to 35 and no one among the
respondents was under 18 years old hence they all had a capacity to understand and
effectively playing their roles in affecting supplier-customer relationship.
5.3.2 Education Levels Of The Respondents
Most of the respondents were educated enough to understand the importance of
creating a strong relationship between the suppliers and the customers.
5.3.3 Gender Of Respondents
Gender was equally balanced as there were 39 female and 41 male.
62
5.4 Discussion Of Objective-Wised Findings
5.4.1 The Influence Of Material Handling Activities On Supplier-Customer
Relationship.
From the findings presented in chapter four, material handling activities is positively
correlated to the supplier-customer relationship as it has a Pearson correlation of
0.000 significant level and 0.551 (moderate relationship), the multiple regression
analysis also revealed that material handling activities had an influence/predicts
supplier-customer relationship with p-value of 0.004 that is below 0.05 and a Beta
coefficient of 0.264 hence positively related.
This supports the study of Kosonaim and Chikanha (2012), which revealed that if
the inbound activities are well done, especially material handling they will positively
improve the organization efficient level and automatically lead to high organization
profit.
Also the findings were also supported by Stefan Koch (2005) who wrote that,
supplier-customer relationship management will be strengthened if the daily
operational activities like material handling are well improved.
This implies that, if material handling activities are well improved, they will lead to
a shorter operating circle, reduce handling cost, facilitate better customer care a thing
that will automatically improve the supplier-customer relationship.
5.4.2 The Influence Of Warehousing Activities On Supplier-Customer
Relationship.
From the findings presented in chapter four, warehousing activities is positively
correlated to the supplier-customer relationship as it has a Pearson correlation of 0.29
significant level (below 0.05 and 0.244 (slight but definite relationship), the multiple
regression analysis revealed that warehousing activities negatively influence/predicts
supplier-customer relationship with p-value of 0.005 that is below 0.05 and a Beta
coefficient of -0.261 hence negatively related.
63
The study findings were very different from Karaduman and Udeli (2015) who wrote
that if all the warehousing activities are well done such as receiving, unloading,
inspection, record keeping and storage they will lead to organizational operational
improvement and lead to a strong relationship between the supplier and customers.
Also the study of Reid and Sanders, (2007) wrote that, Supplier- Customer
relationship is strengthened if most of the firms will seriously engage themselves in
proper inventory management in order to ensure that all the goods are made available
at the right quality, quantity and at a specified time a thing that will also lead to the
organization optimal service level.
Implication from this study is that although all the warehousing activities are well
done and daily operation is improved, they will only make the organization meet its
objectives different from strengthening the supplier-customer relationship, hence
there are other factors to strengthen the supplier-customer relationship more than
warehousing activities.
5.4.3 The Influence Of Transportation Activities On Supplier-Customer
Relationship.
From the findings presented in chapter four, transportation activities is negatively
correlated to the supplier-customer relationship as it has a Pearson correlation of
0.955 significant level (above 0.05 and -0.006 (negative relationship), the multiple
regression analysis revealed that transportation activities negatively
influence/predicts supplier-customer relationship with p-value of 0.369 that is above
0.05 and a Beta coefficient of -0.053 hence negatively related.
The findings are inversely to Bowersox (2010) who wrote that if the inbound
transportation is well planned for its delivery time and make the products reach the
customer is a specified time, it will lead to organizational great performance and all
the materials will flow on there right way. A thing that will strengthen the supplier-
customer relationship.
64
The findings from Branch, (2009) explained that, if transportation activities are
practiced well, it will make the supply chain efficiency and the goods to be delivered
to the customers in economical and very secure way as the study termed Inbound
transportation as the backbone of every manufacturing industry, so if well practiced
the supplier-customer relationship will be in a very good position.
The implication from this study is that, Transportation Activities are not considered
to be among the factors that strengthen the supplier-customer relationship, that’s
why, although the there is any improvement in the transportation activities, the
supplier-Customer relationship decreases by 0.035 hence not influenced.
5.4.4 The Influence Of Distribution Activities On The Supplier-Customer
Relationship.
From the findings presented in chapter four, Distribution activities is positively
correlated to the supplier-customer relationship as it has a Pearson correlation of
0.000 significant level and 0.914 (Very strong relationship), the multiple regression
analysis also revealed that Distribution activities had an influence/predicts supplier-
customer relationship with p-value of 0.000 that is below 0.05 and a Beta coefficient
of 0.919 hence positively influenced.
The study is positively supported by Madison (2019), where he wrote that if the
organization will pick the right distribution channel or network, and improve the
delivery options to make the outbound logistics run effectively and efficiently it will
improve the bond between the supplier and the customer.
The findings also were supported by (Bowersox et al, 2010). If outbound logistics
are effectively and efficiently operated it creates a positive influence not only on the
performance of the business, but also on the customer perception of the quality
product and services provided by the firm. In case of any uncertainty in outbound
flow, it will create the dissatisfaction to the firm’s customer base, when used
properly, it is a strategically important bridge in achieving competitive advantage
and strengthen the supplier-customer relationship.
65
(Manikas 2016) added that, the bond between the suppliers and customers will be
strong if distribution channels properly align with customer’s choice and focus on
service quality priorities.
The implication from the study is that, distribution activities positively influence the
supplier -customer relationship so they should be improved so as to make the bond
forever exist.
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CHAPTER SIX
SUMMARY, CONCLUSION AND RECOMMENDATION
6.1 Introduction
This chapter will give enough summary about the study, including the study
objectives, other reviewed literatures, methodology used, the findings of the study,
conclusion and recommendations.
6.2 Summary Of Findings
The main objective of the study was the impact of inbound and outbound activities
on the supplier-customer relationship, where four specific objectives were formed
from the main objective and that is the impact of material handling activities,
warehousing activities, Transportation Activities and Distribution activities on the
Supplier-customer relationship.
Geographically the study based in Tanzania in Dar Es Salaam region and the data
were collected at Cocacola kwanza Manufacturing Compan the place was chosen
because it is a place where logistics activities are well practiced (both inbound and
outbound activities) so it has been easy for them to respond to issues about logistics
activities and the effect on customer supplier relationship and also the area has been
easily accessible by the researcher so it enabled on saving time and cost, hence the
research kept more focus on the department that mostly deals with logistics.
The theory that was used to support the study was Social Exchange Theory, Network
Theory and Game theory. Also, different literatures of the same study and those
which are relatively related were reviewed to make the researcher understand deeply
the chosen topic and the relationship between variables and the selection of proper
methodology to be used and the formulation of hypothesis to find out what objective
could be accepted or rejected after the findings.
The researcher employed the use of case study design that allows cross sectional data
collection in order to examine the impact of logistics activities towards the supplier-
customer relationship. The quantitative approach has also been used to guide the
67
study in showing the impact of the independent variables towards the dependent
variable. Also the researcher employed the use of random samples to pick the
requires a number of samples after dividing the targeted sample into groups so as to
get the proportionate from each strata in the entire population. Both primary and
secondary data collection methods were used, where questionnaires were used as a
primary data collection method and documentary reviews were used as a secondary
data method, questionnaires were prepared and distributed to 80 respondents then
later collected back for analysis.
The analysis techniques that were used was Pearson correlation analysis (helped the
researcher to know the significance level, direction and strength of the relationship
between the variables) and also multiple regression was used to know the extent in
which the independent variables influence the dependent variables. The used analysis
techniques were made possible with the help of IBM SPSS STATISTICS 20
Findings from the analysis, In testing the hypothesis the researcher concentrated
mainly on the significant value (p-value) and the unstandardized beta coefficient to
find out if the hypothesis will be Accepted or rejected and also the direction of the
relationship between the variables. The researcher accepted the hypothesis if it is
less than 0.05 and if the coefficient will produce the same results as what the
researcher predicted in hypothesis, unless otherwise they were rejected. From the
findings three objectives were Accepted that is material handling which had a
significant level of (0.004) and Beta coefficient of (0.264) also Distribution
Activities which had a significant level of (0.000) and Beta coefficient of (0.919)
and Warehousing Activities which had a significant level of (0.005) and beta
coefficient of (-0.261).the other one remaining objective was rejected that is
Transportation activities that had a significant level of (0.369)and Beta coefficient of
(-0.053).
In explaining the findings, is that, among four objectives, two objectives supports the
findings from other studies (material handling and Distribution) while the remaining
do not support the empirical literatures that is Warehousing and Transportation, this
68
might be due to different in method of analysis as most of the studies used qualitative
which is different from this study which used quantitative, even different in
geographical areas, as most of the study has been conducted abroad while a thing that
is different to this study.
6.3 Conclusion Of The Study
6.3.1 Material Handling Activities And Supplier-Customer Relationship.
Material handling activities yied the same results in Pearson correlation and multiple
regression as both of them showed that material handling positively impacts the
supplier-customer relationship where the significant level in Pearson correlation
Was 0.000 and the p-value was 0.551, which implies there is a moderate relationship
between the variables, coming to the multiple regression the significant level was
0.004 and the Beta coefficient was 0.261, hence material handling positively
influences supplier-customer relationship.
6.3.2 Warehousing Activities And Supplier-Customer Relationship.
Warehousing activities did not produce the same results in Pearson correlation and
multiple regression, where the significant level level in Pearson correlation was
0.029 and the p-value was 0.244 which implies a slight but definite relationship,
coming to the multiple regression the variable completely showed to have a negative
relationship as it had a Beta coefficient of -0.261 hence does not influence the
supplier-customer relationship.
6.3.3 Transportation Activities And Supplier-Customer Relationship.
Transportation activities produced the same results in Pearson correlation and
multiple regression, where the significant level level in Pearson correlation was
0.955 and the p-value was -0.006 which implies the absence of relationship, coming
to the multiple regression the variable completely showed to have a negative
relationship as it had a Beta coefficient of -0.053 hence does not influence the
supplier-customer relationship.
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6.3.4 Distribution Activities And Supplier-Customer Relationship.
Distribution activities yied the same results in Pearson correlation and multiple
regression as both of them showed that distribution activities positively impacts the
supplier-customer relationship where the significant level in Pearson correlation was
0.000 and the p-value was 0.936 which implies there is a very strong relationship
between the variables, coming to the multiple regression the significancy level was
0.000 and the Beta coefficient was 0.919, hence Distribution activities positively
influences supplier-customer relationship.
6.4 Recommendations Of The Study
6.4.1 Recommendation On Material Handling Activities
The study recommends that material handling should be overlooked and given much
consideration on their implementations as they have a very strong influence on
supplier-customer relationship, hence the activities such as proper use of advanced
equipments, material handling systems, employment of well skilled personel to deal
with material handling activities is mostly emphasized for the good results to a
company.
6.4.2 Recommendation On Warehousing Activities
Warehousing activities also relates to supplier-customer relationship, so the study
recommends that all the warehousing ativities such as physical verification of
inventories, issuing and dispatch, receiving and inspection, proper storage of
inventories to retain their original quality, proper location of items so as to minimize
customer waiting time, coding and standardization should all be done with greater
care and with proper personel as they have a very great influence in supplier-
customer relationship and also in creating organization profit.
6.4.3 Recommendation On Transportation Activities
The study has revealed the absence of relationship between transportation activities
and the supplier- customer relationship, the researcher recommends that,
transportation activities should be overlooked because through transportation is
where the rawmaterial from suppliers get into to the organization for production,
70
hence although it does not influence the supplier-customer relationship, but it has its
important role in another angles.
6.4.4 Recommendation On Distribution Activities
Distribution activities such as distribution of proper items, inspection of items before
distribution, avoidance of transit damage, well organized distribution channel, on
time delivery should all be overlooked as they have a strong influence to the
supplier-customer relationship.
Generally: The study recommends the manufacturing Companies to take overlook on
the logistics activities both inbound and outbound so as to improve the organizational
performance and acquire high profit a thing that will strengthen the organizational
reputation and also improve the bond between the suppliers and customers.
Future researchers should go further miles discussing, studying and finding out about
other aspects of inbound and outbound Logistics in manufacturing Industry both in
private and government sectors.. This has expanded knowledge of the researchers but
also benefit the companies or their case studies they are researching on, since
weaknesses and recommendations will be provided.
71
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APPENDIXICES
APPENDIX 1
MASTER OF SCIENCE IN PROCUREMENT AND SUPPLY CHAIN
MANAGEMENT
Dear respondents,
I am a student from Mzumbe university Dar Es Salaam campus who is pursuing a
master's of science in procurement and supply chain management under business
department. Currently, I am conducting a research entitled the impact of logistics
activities in supplier-customer relationship a case of COCA COLA Kwanza
Company as a partial requirement for the award of masters of procurement and
supply chain management
The main purpose of this questionnaire is to gather data for the proposed study, and
hence your kindly requested to assist the succefully completion of the study by
providing the necessary information.your participation is entirely voluntary and the
questionnaire is completely anonymous.i assure you that the information you share
will stay confidential and only used for the mentioned academic purpose, thus not
affects you in any way rather it will help you in improving the performance of your
company.so your genuine, frank and timely response is very vital for the success of
the study,i want to thank you in advance for your kind cooperation and dedication of
your precious time to fill this questionnaire.
Note:
1. No need of writing your name.
2. If you need further explanation please do not hesitate to contact me through
my personal phone
0738 902757 or 0655 505620
Best regards,
Latifah Kimaro
76
PART ONE: PROFILE OF THE RESPONDENTS.
Please circle the appropriate answer:
A1: Your age (in years): (a) 18-20, (b) 21-25, (c) 26-30, (d) 31-35, (e) 36-40, (f) 41-
45, (g) 45+
A2: Your gender: (a) Male (b) Female
A3: Your Level of Education: (a) A-Level, (b) Certificate, (c) Diploma, (d),
Bachelor, (e) Masters, (f) PHD
77
PART TWO
THE IMPACT OF LOGISTICS ACTIVITIES ON THE SUPLIER-
CUSTOMER RELATIONSHIP.
The following statements relate to the impact of logistics activities on the supplier-
customer relationship (logistics activities include material handling, warehousing,
transportation and distribution.)
Rate your agreement with each of the statement by using the scale provided in the
Table below. Circle “O” the number you choose.
Rank: 1=SD; Strongly Disagree, 2= D; Disagree, 3= N; Neutral 4=A; Agree
5=SA; Strongly Agree
STATEMENT S D
D N A S A
MATERIAL HANDLING
1 Shorter operating circle that is created by material handling has an impact on the supplier - customer relationship
1 2 3 4 5
2 Proper material handling reduces the handling cost, hence impacts the supplier - customer relationship
1 2 3 4 5
3 Better customer care that is facilitated by material handling has an impact on the supplier - customer relationship
1 2 3 4 5
4 Material handling facilitates better quality of products, hence has a great impact on the supplier - customer relationship
1 2 3 4 5
5 As the material handling facilitates timely production, hence this has an impact on the supplier - customer relationship
1 2 3 4 5
6 Proper packaging of materials and products looks more modern in the eyes of customers, hence this impacts the relationship between supplier-customer
1 2 3 4 5
7 Inspection of materials on their delivery ensures the production of quality goods, hence this impacts the relationship between supplier-customer
1 2 3 4 5
WAREHOUSING
1 Warehouse personnel serve our customers at the reasonable time, hence impacts the supplier-customer relationship
1 2 3 4 5
2 Cargo are available to the customers just after arrival, hence impacts the supplier-customer relationship
1 2 3 4 5
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3 Proper warehouse management minimizes total carrying costs and lowers the final price, hence impacts the supplier-customer relationship
1 2 3 4 5
4 As proper warehouse minimizes total product damage in the warehouse, hence maintains the customers product quality and has an impact on the supplier-customer relationship
1 2 3 4 5
5 The guidelines or standard operating procedures (SOP) in the warehouse, helps to secure and maintain the customers products, hence impacts the supplier-customer relationship
1 2 3 4 5
6 Proper location of items in the warehouse reduces the customers waiting time, hence this has an impact on the supplier-customer relationship
1 2 3 4 5
7 Items on lines are picked accurately as per customer orders. A thing that impacts the supplier-customer relationship
1 2 3 4 5
TRANSPORTATION
1 The transportation system provides efficiency in logistics a thing that impacts the supplier-customer relationship
1 2 3 4 5
2 The transportation system helps the company reach economies of scale, hence impacts the supplier-customer relationship
1 2 3 4 5
3 The overall quality of companies transportation is very high
1 2 3 4 5
4 The company transportation service is cost efficient,hence impacts on the supplier-customer relationship
1 2 3 4 5
5 Transportation service of the company is flexible hence impacts the supplier-customer relationship
1 2 3 4 5
6 The transportation service gives quick response to special requests, hence has an impact on the supplier-customer relationship
1 2 3 4 5
7 The transportation cost is very competitive in comparison with the market cost a thing that has an impact on the supplier-customer relationship
1 2 3 4 5
8 Transportation system ensures safety and timely delivery to satisfy your customers, hence impacts the supplier-customer relationship
1 2 3 4 5
9 Employee performance, inadequate training,lack of understanding team work are are the human factor challenges affecting transportation hence impacts the supplier-customer relationship
1 2 3 4 5
10 Lack of adequate and modern equipment, infrastructure problems, higher rate of loss and damage, high traffic jam in cities is the non human challenges that affect transportation operation and hence have impacts on the supplier-customer relationship
1 2 3 4 5
DISTRIBUTION
1 The units that are ordered by the customers are fully distributed, hence impacts the supplier-customer relationship
1 2 3 4 5
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2 All orders are consistently distributed to the right customers, hence impacts the supplier –customer relationship
1 2 3 4 5
3 The goods distributed to the customers at the right time, hence impacts the supplier-customer relationship
1 2 3 4 5
4 The average delivery time is reliable, this impacts the supplier-customer relationship
1 2 3 4 5
5 The Products are always distributed as promised,hence impacts the supplier-customer relationship
1 2 3 4 5
6 The damage in transit is minimum hence the quality of goods are well maintained a thing that has an impact on the supplier-customer relationship
1 2 3 4 5
7 The Distribution team responds timely to special request and needs of customers, hence has an impact on the supplier-customer relationship
1 2 3 4 5
8 The distribution sector order policies are flexible enough to permit timely response to the market demand, hence impacts the supplier-customer relationship.
1 2 3 4 5
9 The units distributed to the customers are correct and exactly as specified hence impacts the supplier-customer relationship
1 2 3 4 5
10 Goods are well inspected before distribution, hence impacts the supplier-customer relationship.
1 2 3 4 5
SUPPLIER-CUSTOMER RELATIONSHIP
1 The roles and responsibilities between the suppliers and Customers are well defined
1 2 3 4 5
2 The trust and open communication exists between the suppliers and Customers
1 2 3 4 5
3 There is a continuous improvements between the suppliers and customers toward the agreed targets
1 2 3 4 5
4 The relationship between the supplier and the customers focus more on the common vision and the agreed strategies and the activities
1 2 3 4 5
5 The needs between the two parties are well anticipated and the creative solution normally provides
1 2 3 4 5
6 On time delivery and payments usually takes place 1 2 3 4 5
7 Business Risk are equally shared between the suppliers and the customers
1 2 3 4 5