THE EFFECTS OF LOGISTICS SERVICE DELIVERY ON LOGISTICS PERFORMANCE: THE CASE OF ETHIOPIAN SHIPPING AND LOGISTICS SERVICES ENTERPRISE

Abstract

Integrated logistics service has become a critical part of a national economy and a planned strategy to excel the logistics performance is a pre-requisite. The essence of logistics is recognized worldwide for which nations harness a great deal of concern for the sector. Logistics Performance Index (LPI) is a measure of the overall performance of the logistics sector by combining six elements and is used as a benchmarking tool prepared by the World Bank. Multinational companies are subtle to the figures and the reports made by the World Bank to deploy their investment at a certain country. Nations with excellent logistics performance index rank are highly benefited from the fruits of the sector and strive to keep the sustainability of the integrated logistics service provision. Despite its importance to a national economy, logistics had never been given the desired emphasis in Ethiopia. ESLSE is established to facilitate the import and export trade of the country and takes the leading spot in the determination of Ethiopia’s LPI rank. The objective of this study was to assess the effect of logistics service on logistics performance of ESLSE. Previous studies measured the service quality from the functional dimension (reliability, responsiveness, assurance, empathy and tangibility) of the service quality. Yet, Gronroos suggests the technical and company image dimensions also have a crucial significance on the perceptions of customers. Based on this suggestion, the study incorporated these two dimensions with the five dimensions of the functional service quality aspects and measured the logistics service delivery performance. Purposive non-random sampling technique is implemented to select a sample of 323 respondents from a total population of 1665 importers who import goods for the purpose of merchandising and located in Addis Ababa. The data is collected through structured questionnaire. The respondents were approached by the data collectors at their convenience in offices and sales areas. Data was processed by using Statistical Package for Social Sciences (SPSS) version 20 and analyzed via Pearson-correlation analysis to test the correlation between the dependent and independent variables and regression analysis was made and estimation of the regression model was made using beta coefficients. It was concluded that there is a significant relation between them. The findings of the study revealed that reliability and company image were found to be least factors to affect the logistics performance.