Logistics management practices and performance of small-scale grape processing firms in Dodoma, Tanzania

Abstract

Efficient logistics management practices are widely recognised as the backbone of successful agro-processing businesses, where swift handling and transportation are essential. However, there is a notable gap in the literature regarding the impact of logistics management practices on performance, which has gained scholarly attention. Therefore, this study addresses the gap in the literature by examining the impact of logistics management practices on the performance of small-scale grape processing firms in Tanzania. Specifically, the study first determined the effect of warehouse management practices on performance. Secondly, it examines the relationship between supplier relationship management practices and performance, with logistics capabilities serving as a moderating factor. Thirdly, it investigates the relationship between order management practices and performance, also moderated by logistics capabilities. Lastly, the study determined the influence of transportation management practices on performance. The study was guided by four theories: the Resource-Based View, Dynamic Capabilities, Resource Dependency, and Transaction Cost theories. The study was conducted in Dodoma, Tanzania, using a cross-sectional design. A census approach was used to select 202 small-scale grape processing firms, and purposive sampling was used to determine the study area. A structured questionnaire collected data on logistics management practices and performance. Data was analysed using descriptive statistics and structural equation modelling. The study findings revealed that warehouse management practices, including material handling, storage management, and inventory control, have a positive and significant impact on performance. Moreover, the findings revealed that supplier relationship management practices, specifically buyer-supplier relationship, knowledge transfer, supplier development, and supplier selection, have a positive and significant impact on performance, particularly when moderated by firm logistics capabilities. Furthermore, the findings emphasise that effective order management practices, including order fulfilment, information flow management, and multichannel order management, have a positive and significant impact on performance, with logistics capabilities playing a significant moderating role. Likewise, transportation management practices, including third-party logistics management, physical distribution, and load management, have a positive and significant impact on performance. The study recommends that small-scale grape processing firms prioritise xiii effective logistics management practices and invest in logistics capabilities, as these jointly enhance logistics operations and lead to sustainable and improved performance.