Article Type : Research Article
Authors : Sandar LK
Keywords : Order processing; Packaging; Inventory management; Transportation; Firm performance
This study focuses on the effects of logistics
activities on firm performance of Dagon Foods Processing and Canning Factory
(HlaingTet). The objectives of the study are to identify the logistics
activities of Dagon Foods Processing and Canning Factory, and to analyze the
effects of logistics activities on performance of Dagon Foods Processing and
Canning Factory (HlaingTet). There are totally 98 employees in this factory
among them, 80 employees are selected by using simple random sampling method.
The sample size represents by 82% of population. The primary data are collected
from the owner by in-depth interview and selected employees by conducting
survey through structured questionnaires. The secondary data are obtained from
the relevant text books, previous research paper and the related websites.
Descriptive statistics, correlation analysis, and multiple regression analysis
are used. The data collection period was August, 2023. The result of
correlation analysis shows that the logistics activities (order processing,
inventory management, packaging and transportation) are positively and strongly
correlated with firm performance. The result of multiple regression analysis
shows that order processing, inventory management, packaging and transportation
have significant and positive effects on firm performance. Therefore, Dagon
Foods Processing and Canning Factory should emphasize on logistics activities
to improve firm performance.
Food is one of the pillars upon which society is built. It is fundamental to health, happiness and political stability. The food industry has developed massively, from the fundamentals of production, harvesting and storage, to a situation where productivity is enhanced through genetics, chemistry, mechanization and management. Food processing industries are today facing increasing levels of competitive pressure and difficulty with regard to maintaining and improving profitability. Manufacturing firms can gain competitive advantage through a well-designed logistics management because logistics include all activities from the source of origin to the end of destination. Logistics supports the firm by providing products or services in an efficient manner, which is both important for financial gain and support the objectives of the firm. Within the business sector, logistics can be applied to transportation, warehousing and storage, industrial packaging, material handling, inventory control, order fulfillment, demand forecasting, production planning/scheduling, procurement, customer service, facility location, return goods handling, parts and service support, and salvage and scrap disposal. To be successful, firms must manage their logistics activities, which enhances efficiency, reduce costs and improve performance. Logistics management has to do with acquiring the sufficient resources at the right quantity, place, price, and time. Ideally, manufacturers should take advantage of latest business innovations to drive overall performance (Bello & Adeoye, 2018), and one area where such intervention enhances performance is in logistic activities, such as transportation, inventory management, warehousing, material handling and other logistic activities. Dagon Foods Processing and Canning Factory (HlaingTet) is the private food processing firm. This factory is situated at HlaingTet village, Thazi Township, Meiktila District, Mandalay Division in Myanmar. It products fruit juice, dried fruit, jam, sauce, and dehydrated vegetables. Therefore, this study analyzes the logistics and firm performance of Dagon Foods Processing and Canning Factory (HlaingTet).
In developing countries, agriculture plays a crucial role in the economy and provides the main source of food, income and employment to their rural populations. Agriculture sector is the backbone of Myanmar’s economy. The agriculture sector contributes to 37.8 percent of gross domestic product (GDP), accounts for 25 to 30 percent of total export earnings and employs 70 percent of the labour force. Integration of production agriculture with on-farm primary processing is needed to have higher and sustainable production, productivity, and better quality end products for domestic and export markets. Fruit and vegetable processing projects also aim to replace imported products, like squash, jams, tomato sauces, etc., besides earning foreign exchange by exporting finished or semi-processed products. Additionally, the food processing industry is an important economic segment, contributing to Myanmar in terms of employment creation, provision of food which is a basic necessity and generating substantial revenue for the country. According to this condition, the aim of this study is to investigate logistics management problems and their influence on business performance in the food processing industry. And this foods processing and canning factory also provide not only an economics growth but also foreign currency can increase and develop for GDP of Myanmar. Therefore, this study emphasizes to identify how order processing, inventory management, packaging, and transportation effect the firm performance of foods processing and canning factory. As a food processing industry, Dagon Foods Processing and Canning Factory produces a variety products ranging from Cordial, Jams, Juice, Sauce, dehydrated fruits and vegetables, Herbal Raw for medicine and concentrate, and these products are also exported to Japan, Korea, Singapore, and Thailand. The efficiency and effectiveness of Dagon Foods Processing and Canning Factory’s logistics operation has a considerable influence not only on the business performance of the manufacturer but also on the customer’s perception of the quality of the products and services provided by the manufacturer. For this reason, in order to get competitive advantages through firm performance, Dagon Foods Processing and Canning Factory has to implement logistics activities.
The
objectives of the study are:
This study focused on logistics activities and
performance of Dagon Foods Processing and Canning Factory (HlaingTet). As the
population, there are totally 98 employees in Dagon Foods Processing and
Canning Factory (HlaingTet). Among them, 80 employees are selected as respondents
by using simple random sampling method which represented by 82% of population.
The primary data are collected from 80 employees by distributing structured
questionnaires. The secondary data are obtained from factory’s records and
annual report, documents provide by the factory, and internet websites. The
collected data are analyzed by using descriptive statistics, correlation
analysis, and multiple regression analysis. Generally, there are fourteen
logistics activities. Among them, the present limitation of the study is that
focuses on logistics activities (order processing, inventory management,
packaging and transportation). The survey period was conducted in August, 2023.
The data are only collected from 80 employees of Dagon Foods Processing and Canning
Factory (HlaingTet). Their perception on firm performance may be different from
respondents of other food processing industries.
Council of Logistics Management (1991) defined that logistics is ‘part of the supply chain process that plans, implements, and controls the efficient, effective forward and reverse flow and storage of goods, services, and related information between the point of origin and the point of consumption in order to meet customers’ requirements. Logistics management is that part of the supply chain process that plans, implements, and control the effective flow and storage of goods, service, and related information from point-of-origin to the point-of-consumption in order to meet customers’ requirements [1]. The logistics of physical items usually involves the integration of information flow, material handling, production, packaging, inventory, transportation, warehousing, and often security [2]. Logistics is a link between the market place and the operating activity of the business. The scope of logistics spans the organization, from the procurement and management of raw materials through to the delivery of the final product. Logistics plays a huge role within today’s economy. Today, companies have good infrastructure and record keeping, which continues to improve through advancements in technology. This means that logistics has an impact on the shipment of goods and how quickly they can get to the consumer, again adding a competitive edge to other businesses [3].
Logistics Activities
The elements of the logistics activities must work as
a unit to achieve the greatest ability to unite and work together. For
logistical activities, important factor is the ability to respond quickly to
market changes, as well as take into account the various changes in the
environment. Due to these features, all the elements of logistics activities
represent a single activity having a feedback and flexible in responding to
what is happening described the fourteen logistics activities [4,5]. These
activities are materials handling, transportation, warehousing and storage,
inventory management, packaging, order processing, demand forecasting,
production planning, purchasing, customer service levels, plant and warehouse
site location, return goods handling, part and service support, and salvage and
scrap disposal. Among them, this study focuses such as order processing,
inventory management, packaging and transportation.
Order
Processing
Order processing is the process or work flow from
order placement to delivery. This is a key element of retail order fulfillment,
where reliability and accuracy lead to customer satisfaction. Steps in order
processing include picking, sorting, tracking and shipping. Order processing
can range from manual processes (hand written on an order log sheet) to highly
technological and data-driven processes (through online orders and automated
order processing software) depending on the operation [6]. Order Processing is important
in logistics because it’s an organized and effective procedure in take care of
customer orders. As a consequence, efficient processing of orders will lead to
increased sales and higher customer satisfaction.Each order is assigned a
tracking number which is then shared (either manually or automatically,
depending on the software) with the customer, allowing them to see the status
of their order every step of the way. Finally, items are delivered to the end
customer [6]. Order processing includes activities for receiving, handling,
filing, recording of orders. Management has to ensure that order processing is
accurate, reliable and fast. Delays in execution of orders can become serious
grounds for customer dissatisfaction; which must be avoided at all costs [7].
Because the order processing cycle is a key area of customer interface with the
organization, it can have a big impact on a customer’s perception of service,
and therefore satisfaction [1].
Inventory
Management
Drury (1996) defined inventory as a stock of goods
that is maintained by a business in anticipation of some future demand.
Inventory management is an accounting term that refers to goods that are in
various stages of being made ready for sale, including finished goods (that are
available to be sold), work-in-progress (meaning in the process of being made)
and raw materials (to be used to produce more finished goods). According Chase
et al, inventory is the stock of any item or resource used in any organization.
An inventory system is the set of policies and controls the minor levels of
inventory and determine what levels should be maintained, when stock should be
replenished and how large order should be [8].
Inventory management is of great importance especially
for managers who must decide how much to hold and how to administer the rest of
the logistics system more creatively in order to ensure that customer service
does not suffer as a result of lower inventory levels. That’s the reason why
inventory management requires a particular attention or the support of the
entire company’s management levels in order to meet customers’ satisfaction
[9]. When making decisions on inventory, management has to find a compromise
between the different cost components, such as the costs of supplying inventory,
inventory-holding costs and costs resulting from insufficient inventories [8].
Packaging
Packaging is a fairly new concept that has during the
last years developed and gained increased attention by both industry and
scientific community [10]. Product packaging has earned a great emphasis today
because these factor considered safe to use by the consumers. Food packaging
has four main functions: containment, protection, convenience and
communication; all of them are correlated to each other and need to be
considered during the packaging development process [11]. Packaging can be
described as a coordinated system of preparing goods for transport,
warehousing, logistics, sale, and end use. Packaging contains, protects,
preserves, transports, informs, and sells [12]. Packaging also affects supply
chain effectiveness because it represents an interface between the supply chain
and its main customer: the end user and enables the chain’s primary task i.e.
serving end consumers, to be accomplished. This is especially evident in the
Fast Moving Consumer Goods supply chain [13].
Transportation
Transportation physically moves product from where they are produced to where they are needed. This movement across space or distance adds value to products. This value is often referred to as place utility. Transportation is also a factor in time utility, it determines how fast and consistently a product moves from one point to another [14]. Transportation is the most significant area of logistics because of the impact on customer service level and cost structure. Without well-developed transportation systems, logistics could not bring its advantages into full play. Besides, a good transport system in logistics activities could provide better logistics efficiency, reduce operation cost, and promote service quality. A well-operated logistics system could increase both the competitiveness of the government and enterprises [5]. Nowadays, organizations are concerned about transportation management because transportation represents a major expense item. And, the transportation system is the physical link connecting a firm’s customers, raw material suppliers, plants, warehouses, and channel members. In addition, a good transport system performing in logistics activities brings benefits not only to profitability but also to company competitiveness [3].
The concept of firm performance has received various
interpretations over the years. Some look at the firm performance to mean the
development of share prices, while others viewed it in terms of profitability
[15]. A firm’s marketing performance indicates how productive its marketing
activities are with regards to its marketing goals, which is influenced by the
firm’s characteristics, approach, internal and external environment, resources
and other qualities/characteristics of the shareholders and management of the
firms. The most notable performance measures of a firm are financial and
non-financial measures, and in strategic management research, firm performance
is frequently used as a dependent variable [16]. According to the Richard et
al, firm performance encompasses three specific areas of firm outcomes:
financial performance (profits, return on assets, return on investment), market
performance (sales, market share), and value added. Firm performance include
return on asset, return on investment, market share, sale growth, customer
satisfaction, cost, employee satisfaction, lead time and profit. Firm
performance comprised the actual output or results of an organization as measured
against its intended outputs (or goals and objectives), it involved the
recurring activities to establish organizational goals, monitor progress toward
the goals, and make adjustments to achieve those goals more effectively and
efficiently [17].
Based on the results of literature review, it can be
constructed a conceptual framework. This study only focuses on the logistics
activities as inventory control, transportation, packaging, and order
fulfillment in the field of foods processing and canning factory. The
conceptual framework of the study is shown (Figure 1). According to Figure (1),
order processing, inventory management, packaging, and transportation are
independent variables and firm performance (increasing sale volume,
productivity, revenue, reduced cost and saving time) is dependent variable. The
main purpose of this research is to find out whether the logistics activities
have a significant effect and subsequently helps firm to improve firm
performance of Dagon Foods Processing and Canning Factory.
The factory is practicing four logistics activities according to business nature, such as order processing, packaging, inventory management, and transportation.
Figure 1: Conceptual Framework of the Study
Order
Processing
Order processing activities is important for food
processing and canning factory. The factory has to deliver the products to the
customers when the customers want. And the factory has to handle concerning
with the ordering materials. Firstly, it collects the orders from customers and
then the customers’ orders are fulfilled. The factory directly fulfill the
customer’s orders to sites in previously connected townships and also give the
service delivery to the public transportation gate for the customers from other
cities. Moreover, the factory also delivers orders through Global Sky Company
Limited for distribution in Yangon. The Global Sky Company Limited is the main
distributor of Dagon Foods Processing and Canning Factory. The factory always
careful to deliver the right quality of products what the customer order and
perform the customer order on time.
Inventory
Management
According to the business nature, Dagon Foods
Processing and Canning factory has cold storage room to store fruits pulp and
semi-finished products in order to produce jam. The workers to warehousing
department are responsible to entry daily stock in and stock out according to
their stock form. Therefore, inventories are used not only for storing raw
materials or finished products but also receiving products from multiple
suppliers. In addition, factory uses first-in, first-out (FIFO method) for raw
materials and finished goods. The warehousing department of Dagon Foods
Processing and Canning factory is one of the main activities in operation of
the firm. There are four warehouses to store and distribute the products to
require destination smoother and faster without any damage. The warehouse that
stored raw materials, semi-finished and finished products locate nearly in the
plant. Raw materials are stored according to product categories. Finished
products are also stored with suitable shelves and placed according to product
names. The employees of warehousing department are responsible for verifying
the quantities and quality of raw materials and finished products before
receipting. After checking, the employees have to place the materials according
to their products category. The employees have to place the materials according
to their receipting. After checking, the employees have knowledge of the
expiration, weight and size of each product to store and manage raw materials
and finished products. Dagon Foods Processing and Canning factory’s inventory
management helps their product demand and take inventory control has to do with
keeping accurate records of goods that are ready to transport. Therefore,
factory has no delays in delivery of products due to sufficient inventories.
Packaging
The packaging serves the important function of
containing the food, protecting against chemical and physical damage whilst
providing information essential to consumers and marketers. Dragon Foods
Processing and Canning Factory’s packaging plays important role in the smooth
transfer to finished goods from plant to the distribution center and customer
locations. Firstly, these items are picked from the shelves and placed to the
packaging area. After packaging, the firm distributes to customers. Dragon
Foods Processing and Canning Factory packed its products with plastic bag,
cans, glasses and carton box. And factory’s main packaging materials are
plastics and tinplate steel. Plastic can protect water. Due to pitting
resistance and quality surface finish it is easy to clean and maintain.
Moreover, tinplate steel does not change the color, taste or smell of the
canning food. The purpose of their packaging is to protect from damaging,
temperature shocks during transportation and it is easy to handle during the
movements from point to point and minimizing of space in warehouse.
Transportation
Transportation of Dagon Foods Processing and Canning
factory provides the essential service of linking factory to its suppliers and
customers. There are five ways of transportation such as rail, road, ship, air
and pipeline. Dagon Foods Processing and Canning factory is especially using
road way. The factory has chosen road way for both inbound and outbound
transportation in daily activities. The factory uses private transportation
service firms and public transportation for delivery system. The factory uses
transport schedule to deliver finished goods to customer's right time, right
place and right product. The firms always
check vehicle condition to smooth transportation. And they also use lead time
to effective and efficient transportation channels. Therefore, the factory can
reduce transportation time and cost and also they can arrange on time delivery
of customers order.
Logistics activities are accelerated the operation performance. Reducing cost of each outbound logistics activities influence the total amount of costs and enhance firm’s performance. The main goal of the firm is to maximize the revenue and sale maximization. Profit maximization is to maximize the present value of the firm and try to maximize sale growth. Firm performances are measured by the improvement in productivity. Dagon Foods Processing and Canning Factory have produced the products based on the orders from Dagon Foods Company. Dagon Factory has been gaining the increase in sale growth through the logistics activities within from 2015-2016 to 2018-2019. Dagon factory has been gaining improvement in productivity through the logistics activities within four years from 2015-2016 to 2018-2019. This means improving in the strength to determine the productivity in the factory. Then, the factory’s annual production units are also seen in the following (Table 1). According to Table (1) performance of Dagon Foods Processing and Canning factory can be measured by productivity in Tons. According to this data, firm performance has increased over last five years and the logistics activities were developed in Dagon Foods Processing and Canning factory.
Table 1: Annual Production (Tons) of Dagon Foods Processing and Canning Factory
Sr. No. |
Years |
Production (Tons) |
1 |
2015-2016 |
130 |
2 |
2016-2017 |
153 |
3 |
2017-2018 |
214 |
4 |
2018-2019 |
240 |
Source:
Dagon Foods Processing and Canning factory (August,2023) |
Demographic profile of respondents include gender,
age, marital status, education level, position, income level and working
experience. To analyze the effects of logistics activities on performance of
Dagon Foods Processing and Canning Factory (HlaingTet), frequency distributions
of seven demographic factors for 80 respondents are shown in the following
Tables (Appendix A). Analysis of Respondent Perception on Logistics Activities
and Performance This section is to analyze the effects of logistics activities
on firm performance of Dagon Foods Processing and Canning Factory (HlaingTet).
Reliability of the
Variables
This section is to analyze the effects of logistics activities on performance of Dagon Foods Processing and Canning Factory (HlaingTet). Firstly, descriptive statistics, reliabilities, the mean values of the factors, and correlations were calculated. Before the reliability analysis, four components of the logistics activities were measured with 25 items, firm performance was measured with eight items. According to the results of the reliability analysis of the variables, all items of each variable support the acceptable level of reliability test. Cronbach (1951) described reliability is the overall consistency of a measure [18- 32]. The alpha value for each question is identified and summarized, which shows the reliabilities (Alpha values) of the variables (Table 2). Table (2) presents Cronbach’s alpha value for each item: order processing, packaging, inventory management and transportation and firm performance from 0.600 to 0.744. The reliability of order processing is 0.600, the reliability of packaging is 0.794, the reliability of inventory management is 0.745, the reliability of transportation is 0.813 and the reliability of firm performance is 0.744. Therefore, the alpha values of all variables have reliable and acceptable levels.
Table 2: Reliability of the Variables.
Sr. No. |
Logistics
Activities |
Items |
Cronbach’s Alpha |
1 |
Order
Processing |
6 |
0.600 |
2 |
Inventory Management |
7 |
0.745 |
3 |
Packaging |
7 |
0.794 |
4 |
Transportation |
5 |
0.813 |
5 |
Firm
Performance |
8 |
0.744 |
Source: Survey Data (August, 2023) |
Summary of Respondent Perception on Logistics Activities
In studying order processing, packaging, inventory management and transportation are focused and presents overall employee perception on logistics activities (Table 3). Table (3) describes the overall mean values of order processing, packaging, inventory management and transportation. The maximum mean value of order processing is 4.04, it means because employees accept fulfilling the right quality of customer’s order product, always accepting customer order exactly with required information (date, time, place, product, type with comments) and performing customer order just-in-time. Although the minimum mean value of inventory management is 3.88, it shows the agree level.
Table 3: Summary of Respondent Perception on Logistics Activities.
Sr. No. |
Particular |
Mean |
SD |
1 |
Order
Processing |
4.04 |
0.614 |
2 |
Inventory Management |
3.88 |
0.583 |
3 |
Packaging |
4.01 |
0.559 |
4 |
Transportation
|
3.92 |
0.652 |
Source:
Survey Data (August, 2023) |
Table 4: Respondent Perception on Firm Performance.
Sr. No. |
Description |
Mean |
SD |
1 |
Increasing revenue
by performing customer’s order on time |
4.15 |
0.638 |
2 |
Increasing sale
value by using order processing software |
3.61 |
0.907 |
3 |
Reducing
transportation cost by using good quality packaging |
4.25 |
0.666 |
4 |
Saving time and cost
by using automatic packing machines |
3.88 |
0.848 |
5 |
Reducing storage
cost due to use effective inventory management and production planning |
4.01 |
0.864 |
6 |
Increasing
productivity by using systematically inventory control |
4.03 |
0.729 |
7 |
Increasing
productivity by using annual transportation planning |
3.99 |
0.755 |
8 |
Saving time and cost
by using transportation schedule |
4.29 |
0.679 |
|
Overall
Mean |
4.02 |
|
Source: Survey Data (August,
2023) |
Respondent Perception on
Firm Performance
Firm performance factors were measured with eight
statements. The results in the table show the mean values and overall mean
value concerning firm performance of logistics activities in the factory. The
overall mean score is 4.02 and it can be concluded respondents are agreed with
their performance at factory. The maximum mean of 4.29 shows that the factory
has saving time and cost by using transportation schedule over last five years.
The minimum mean value of 3.61 shows that agree level of respondents. It means
that the factory has increased sale value by using order processing software
over last five years (Table 4).
Correlation Analysis of
Logistics Activities and Performance
After the reliability, correlations of independent
variables (order processing, packaging, inventory management and
transportation) are tested to show their correlation with dependent variable
(firm performance). Correlation is the statistical technique that can show
whether and how strongly pairs of variables are related. Correlation
coefficient ranges from -1.0 to +1.0. As the correlation coefficient value goes
toward 0, the relationship between the two variables will be weaker. The
direction of the relationship is indicated by the sign of the coefficient; a
(+) sign indicates a positive relationship and a (-) sign indicates a negative
relationship. If the value is positive, it means that as one variable gets
larger, the other gets larger. If the value is negative, it means that one
variable gets larger, the other gets smaller. The results of the correlations
of the measured variables are shown (Table 5).
Table 5: Correlation between Logistics Activities and Performance.
Sr. No. |
Logistics Activities |
Pearson Correlation Coefficient |
P-value |
1 |
Order
Processing |
0.474** |
0.000 |
2 |
Inventory Management |
0.748** |
0.000 |
3 |
Packaging |
0.729** |
0.000 |
4 |
Transportation
|
0.653** |
0.000 |
Source: Survey Data
(August, 2023) **Correlation is significant at the 0.01 level (2-tailed) |
As the main analysis, the study was applied regression
analysis to test the objective of the effects of logistics activities (order
processing, packaging, inventory management and transportation) and firm
performance. Multiple regression analysis is conducted to test the proposed
objectives. The results of the multiple regression analysis are shown (Table
6).
P < 0.05; Dependent variable: Firm Performance
The propose Model is
Y=
?0 + ?1X1+?2X2+ ?3X3+ ?4X4+ ?i
The estimate model is,
y
= a+ b1X1+b2X2+ b3X3+ b4X4
where,
y
= Firm Performance
a
= Constant (intersection)
b
= Coefficient (the slope of the regression)
X1
= Order Processing
X2
= Inventory Management
X3
= Packaging
X4
= Transportation
?i = Random
error
Thus, the regression equation is;
Firm Performance = 0.560 + 0.187 Order Processing + 0.296
Inventory Management
+ 0.216
Packaging + 0.176 Transportation
According to
the results in Table (6), the model explains that the variation in overall
level of performance exists as R square value is 64 percent. This indicates
that independent variables can explain 64 percent variation in dependent
variable. If the company has emphasized the logistics activities (order
processing, inventory management, packaging and transportation) the performance
will have been 0.560. Among the logistics activities, the factory gets more
performance as the results of order processing, inventory management, packaging
and transportation. According to the results among logistics activities, order
processing, inventory management, packaging and transportation show the
positive and significant effect on performance. The results show that order
processing has positive and significant effect on firm performance because its
p-value is 0.024. It shows that the amount of firm performance would increase
by every unit change in the factor of order processing when all other variables
are constant. This implies that there is a positive and significant effect of
order processing on firm performance at 5% significant level. One additional
unit of order processing increased 0.187 times in performance.
The results show that inventory management has
positive and significant effect on firm performance because its p-value is
0.018. It shows that the amount of firm performance would increase by every
unit change in the factor of inventory management when all other variables are
constant. This implies that there is a positive and significant effect of
inventory management on firm performance at 5% significant level. One
additional unit inventory management increased 0.296 times in performance. The
results show that packaging has positive effect on firm performance because its
p-value is 0.062. It shows that the amount of firm performance would increase
by every unit change in the factor of packaging when all other variables are
constant. This implies that there is a positive and significant effect of
packaging on firm performance at 10% significant level. One additional unit of
packaging increased 0.216 times in performance. The results show that
transportation has positive and significant effect on firm performance because
its p-value is 0.027. It shows that the amount of firm performance would
increase by every unit change in the factor of transportation when all other
variables are constant. This implies that there is a positive and significant
effect of transportation on firm performance at 5% significant level. One
additional unit of transportation increased 0.176 times in performance.
Table
6:
The Effect of Logistics Activities on Firm Performance.
Model |
Unstandardized coefficients |
Standardized Coefficients |
t |
Sig |
|
B |
Std. Error |
Beta |
|||
(constant)
|
0.560 |
0.327 |
|
|
|
Order
Processing |
0.187 |
0.081 |
0.185 |
2.306 |
0.024 |
Inventory Management |
0.296 |
0.123 |
0.310 |
2.412 |
0.018 |
Packaging |
0.216 |
0.114 |
0.235 |
1.893 |
0.062 |
Transportation |
0.176 |
0.078 |
0.235 |
2.255 |
0.027 |
R2 |
0.645 |
||||
Adjusted
R2 |
0.626 |
||||
Source: Survey Data (July, 2020) |
Table
7: Order
Processing
Sr.
No. |
Statement |
Perception |
||||
1 |
The factory provides customer’s order
product with period of time. |
1 |
2 |
3 |
4 |
5 |
2 |
The factory can perform customer order
just-in-time. |
1 |
2 |
3 |
4 |
5 |
3 |
The factory uses order processing
software to reduce errors in maintaining order detail. |
1 |
2 |
3 |
4 |
5 |
4 |
The factory staffs always accept
customer order exactly with required information (date, time, place, product,
type with comments). |
1 |
2 |
3 |
4 |
5 |
5 |
The factory services ordered product
with standard quality. |
1 |
2 |
3 |
4 |
5 |
6 |
The factory fulfills the right quality
of customer’s order product. |
1 |
2 |
3 |
4 |
5 |
Table 8: Inventory Management
Sr.
No. |
Statement |
Perception |
||||
1 |
Factory uses effective
inventory management and production planning. |
1 |
2 |
3 |
4 |
5 |
2 |
Factory keeps inventory
record by manually. |
1 |
2 |
3 |
4 |
5 |
3 |
Factory also uses
inventory control software. |
1 |
2 |
3 |
4 |
5 |
4 |
Factory uses
just-in-time inventory management practices to reduce inventory costs. |
1 |
2 |
3 |
4 |
5 |
5 |
Inventories are
systematically stored at the factory depend on the type of the product. |
1 |
2 |
3 |
4 |
5 |
6 |
Factory has sufficient
warehouses to maintain raw materials. |
1 |
2 |
3 |
4 |
5 |
7 |
The responsible person
usually checks inventory balance for warehousing and storage activities. |
1 |
2 |
3 |
4 |
5 |
|
Table
9: Packaging
Sr.
No. |
Statement |
Perception |
||||
1 |
Packaging protects physical accidents
and barriers. |
1 |
2 |
3 |
4 |
5 |
2 |
Packages and labels give exact
information to customer how to use. |
1 |
2 |
3 |
4 |
5 |
3 |
The factory always uses the good quality
packaging materials. |
1 |
2 |
3 |
4 |
5 |
4 |
The factory uses IT technology,
electronic machines and automatic packing machines. |
1 |
2 |
3 |
4 |
5 |
5 |
The factory uses tinplate steel (safety
pack of product and safety first of customer) packing material. |
1 |
2 |
3 |
4 |
5 |
6 |
The factory’s product has attractive
packaging design. |
1 |
2 |
3 |
4 |
5 |
7 |
The factory uses the good quality of
plastic packaging system approved by FDA. |
1 |
2 |
3 |
4 |
5 |
Table
10: Transportation
Sr.
No. |
Statement |
Perception |
||||
1 |
The factory uses the
safety and security truck cars for transportation. (public transportation) |
1 |
2 |
3 |
4 |
5 |
2 |
The factory uses
transport scheduling to ensure that deliveries are completed in right time,
right place and right product. |
1 |
2 |
3 |
4 |
5 |
3 |
The factory prepares an
annual transportation planning for saving transportation cost. |
1 |
2 |
3 |
4 |
5 |
4 |
The factory regularly
checks the track car in order to smooth transportation. |
1 |
2 |
3 |
4 |
5 |
5 |
The factory use
effective and efficient transportation channels. |
1 |
2 |
3 |
4 |
5 |
Table
11
Sr.
No. |
Statement |
Perception |
||||
1 |
The factory has
increased revenue by performing customer’s order on time over last five
years. |
1 |
2 |
3 |
4 |
5 |
2 |
The factory has
increased sale value by using order processing software over last five years. |
1 |
2 |
3 |
4 |
5 |
3 |
The factory has reduced
transportation cost by using good quality packaging design over last five
years. |
1 |
2 |
3 |
4 |
5 |
4 |
The factory has saving
time and cost by using IT technology, electronic machines and automatic
packing machines over last five years. |
1 |
2 |
3 |
4 |
5 |
5 |
The factory has reduced
storage cost due to use efficient and effective inventory management and
production planning over last five years. |
1 |
2 |
3 |
4 |
5 |
6 |
The factory has
increased productivity by maintaining efficient and effective inventory
control over last five years. |
1 |
2 |
3 |
4 |
5 |
7 |
The factory has
increased productivity by preparing detail annual transportation planning
over last five years. |
1 |
2 |
3 |
4 |
5 |
8 |
The factory has saving
time and cost by using transportation schedule over last five years. |
1 |
2 |
3 |
4 |
5 |
Sr. No. |
Description |
Frequency |
Percentage |
1 |
Gender of Respondents |
||
|
Male |
33 |
41.25 |
|
Female |
47 |
58.75 |
|
Total |
80 |
100.00 |
2 |
Age of Respondents |
||
|
25
to 34 years |
42 |
52.50 |
|
35
to 44 years |
21 |
26.25 |
|
45
to 54 years |
10 |
12.50 |
|
55
years and above |
7 |
8.75 |
|
Total |
|
100.00 |
3 |
Marital Status of
Respondents |
||
|
Single |
21 |
26.25 |
|
Married |
59 |
73.75 |
|
Total |
80 |
100.00 |
4 |
Educational Level
of Respondents |
||
|
High
School |
46 |
57.50 |
|
University
Students |
16 |
20.00 |
|
Graduate |
17 |
21.25 |
|
Post
Graduate |
1 |
1.25 |
|
Total |
80 |
100.00 |
5 |
Position of Respondents |
||
|
Director
|
1 |
1.25 |
|
Manager |
9 |
11.25 |
|
Assistant
Manager |
12 |
15.00 |
|
Supervisor |
16 |
20.00 |
|
General
Worker |
42 |
52.50 |
|
Total |
80 |
100.00 |
6 |
Income Level of Respondents |
||
|
100,001
- 200,000 Kyats |
42 |
52.50 |
|
200,001
- 300,000 Kyats |
16 |
20.00 |
|
300,000
- 400,000 Kyats |
12 |
15.00 |
|
Above
400,001 Kyats |
10 |
12.50 |
|
Total |
80 |
100.00 |
7 |
Working Experience of Respondents |
||
|
1 -
3 years |
32 |
40.00 |
|
4 -
6 years |
38 |
47.50 |
|
7
years and above |
10 |
12.50 |
|
Total |
80 |
100.00 |
Source: Survey Data
(August, 2023) |
Among the logistics activities, inventory management had more supported firm performance than any other factors. According to the results among the logistics activities, order processing, inventory management and transportation are appropriate positive and significant effect on firm performance. This study analyzed relationship between logistics activities and firm performance. The result revealed that logistics activities are essential for firm performance. The final results of the multiple regression analysis are illustrated in the following (Figure 2).
Figure 2: Conceptual Framework with Results.
According to Figure (2), structural model of logistics
activities, the research finding on the effects of logistics activities and
firm performance of Dagon Foods Processing and Canning Factory (HlaingTet) is
shown as follows. Inventory management shows the most significant effect on
firm performance. Order processing, packaging and transportation also found
that the positive and significant effect on performance. This study highlights
the importance of order processing, inventory management, packaging and
transportation to increase firm performance.
Dagon Foods Processing and Canning Factory (HlaingTet)
uses the good quality of the raw materials the safe product for customer and
give the safety first for human on the virtual issues by testing and approving
by FDA. Dagon Foods Processing and Canning Factory (HlaingTet) fulfills
customers' products by using the right quality of products specifically
according to recorded data from the order processing department. And the
Factory (HlaingTet) uses the responsible person to maintain and check the
quality of raw materials and finished goods at warehousing and storage.
Moreover, they rent vehicles from long term relationship owners who arrange
drivers to deliver the products for right time, right days, and right palaces
according to transportation plan of factory. By analyzing the employee
perception on performance, it is found that the respondents agree the
performance of Dagon Foods Processing and Canning Factory (HlaingTet).
Moreover, the correlation of the variables showed that
the logistics activities (order processing, inventory management, packaging and
transportation) and firm performance has the strong and positive correlation. In
this multiple regression analysis, order processing, inventory management,
packaging and transportation are significant and positive effect on performance
of Dagon Foods Processing and Canning Factory (HlaingTet). These results show
that factory can create better performance as the result of order processing,
inventory management, packaging and transportation of logistics activities.
Therefore, these factors were taken into consideration and essential for the
improvement of firm performance. The
findings of this study are valuable for the organization to consider the
strengths and weakness of the logistics activities in the real workplace. Based
on the findings of the study, the factory can achieve and meet its goal and
objective by implementing systematically logistics activities because these
logistics activities are essential for Dagon Foods Processing and Canning
Factory (HlaingTet). Therefore, the factory should carefully manage to increase
logistics activities and to increase firm performance in long term. For further
research, it is suggested that this research is expanded to the whole Myanmar
of factory's logistics activities and firm performance. It can be used in other
organization such as manufacturing or service organization, private or public,
profit or non-profit organization. Further research should conduct the
logistics activities of other companies in Myanmar.