Abstract

This study investigates the impact of inbound logistics activities on the organizational performance of COGENI in Limbe Municipality, Cameroon. Recognizing the critical role of logistics in enhancing operational efficiency, this research aims to analyse how factors such as communication, sourcing materials, and delivery time influence performance outcomes.

A sample of 100 respondents from COGENI was selected using stratified sampling techniques, and data was collected through structured questionnaires and interviews. Both quantitative and qualitative analysis methods, including regression analysis, were utilized to assess the relationships between inbound logistics activities and performance indicators such as customer satisfaction and operational efficiency.

Findings reveal that effective inbound logistics significantly enhances organizational performance, characterized by improved service delivery and reduced operational costs. The study underscores the need for COGENI to adopt robust logistics strategies and invest in training for staff to optimize their inbound logistics processes, thus bolstering competitiveness in the market.

CHAPTER ONE

INTRODUCTION

1.1 Background of The Study

The business world continues to be competitive and with the technological advancement, organisations are focusing on strategies such as; high customer service levels, lower cost as well as lead time management as a competitive advantage.

Currently, the logistics activities are categories of inbound logistics depending much on their functions and the effect on the organisational activities at large (summit, 2015). The inbound logistics covers all the functions and activities involved in the movement of materials received from outside one’s organisation such as the inventory control, warehousing and transportation (Malik,2010). According to Arnold (2014), the 1970s significance of logistics has greatly increased the activities required to accomplish various logistical functions and strategic planning process which includes coordination and coordination with the channel partners namely; suppliers, intermediaries, third party service providers and customer’s increases.

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 1999s, 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 enabling them to conquer the nations, while from Africa minerals such as gold, copper and salt was transported overseas. In the 1920s 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 1990s to the beginning of the 21st century, logistics activities are used much to strengthen and influence on the performance. Takin (2011) in his study on the importance of logistics activities revealed that, one of the major significances of logistics activities is on influencing performance. According to Hand-field (2007) logistics create time to place utilities in the products and thereby helps in maximising the Value satisfaction to customers. By ensuring quick deliveries in minimum time and cost, it relieves the customer’s of holding excess inventories.

Inbound logistics innovation, (Gravill, 2005) wrote that one of the most neglected areas of the manufacturing (and retail) supply chain is the inbound logistics segment Similar to the marketing development, the purchase department has its own unique set of requirements for inbound raw materials/ work-in-progress and other inbound materials. In addition, modern Just in time manufacturing methods push the procurement manager to aim to achieve lower inventory models, often at the expense of higher inbound transportation practices (low inventory, shipment sizes, visibility of goods). Most of the empirical evidence show that the inbound logistics activities have an effect on the performance and if the activities are conducted well enough the respective organisations will benefit much.

Today’s competition leads companies to redesign their existing processes, technologies, products and services in order to focus on their core competencies. In that context, enterprises outsource a part of their activities in order to establish partnerships and privileged alliances, allowing better external collaboration. To increase their own performance in the supply chain, enterprises tend to focus now on their core business and to outsource noncore activities. Outsourcing is an approach that consists in making carry out by an external partner an activity, which has been carried out until then internally. As indicated by Abdul-Malik et al. (2005) , outsourcing targets , on one hand , the concentration of the company on its key competencies and on the other hand , economies of scale.

A study from Robinovich et al. (1999) on the outsourcing of different logistics activities shows that customers service could be improved and costs reduce by outsourcing diverse logistics functions such as internal logistics. Logistics previously viewed as a classic function, which involves customer transaction providers, is emerging as a key source of competitive advantage and a leading reason for strategic alliance relationship between companies and their logistics providers (Hai and Yirong 2002)

With the awareness of strategic implication of logistics and the growing awareness of the benefits of leveraging logistics to increase customer value measuring the performance that had become a high priority (Chengman & Greimm,2006; Griffis, Goldsby, Cooper, & Closs, 2007) in this study the dependent variable is where the core factors that led to success of inbound logistics activities and they include: implementing , and controlling procedures from the efficient and effective transportation and storage of goods including services and related information from the point of origin to the point of consumption for the purpose of conforming to customer requirements and includes inbound transportation. (Lambert & Stick,2008).

Logistics management is a supply chain management component that is used to meet customer demand and through the planning, control and implementation of the effective movement and storage of related information, goods and services from origin to destination. Logistics management helps companies reduce expenses and enhance customer service. (Fugate, et al. 2010)

A logistics system is made up of a large number of stakeholders. They include the suppliers, manufacturers, wholesalers, and retailers who have to be managed strategically in order to deliver final products in the right quantities at the time and quality at the right place, at the right cost and at the right customer. Logistics strategy has three main objectives; cost reduction, capital reduction and service improvement. In the last two decades, product flow has been greatly improved due to better technology in communication and transportation. Increased variety of goods, globalisation of marketing and seasonal variations is among the major challenges of logistics system which leads to the necessity of developing effective logistics strategies in the agricultural sector (Gebresenbet & Bosona, 2012)

To deal with the objectives of supply chain, new business processes have been implemented these last years on the logistics segment. They generally imply a new way of managing performance, more collaborative, between a company and its partners. Derrouiche (2006) proposed a synthesis of some of these methods such as quick response- QR. Recent changes in business dynamics necessitate organisation to recognise the importance of strategically re-looking at their business process (Nyaberi & Mwangangi, 2014).

Particularly, every company aims at gaining part in the growing global market and taking advantage of the advancement in technology. This, the need for supply chain practices in operations has increased immensely as it has been establishing to the effect in gaining competitive advantage. Logistics and transformation being among the supply chain practices that enhance proper coordination of activities in organisation (Lai et al., 2008). Management in logistics is termed as the coordination of activities in a firm aimed at ensuring spongy operations from the initial production processes to the final distribution processes (Fawcet & Magnan, 2001).

1.2. Problem Statement

Inbound logistics activities are designed and executed to ensure smooth flow of materials, equipment and personnel involved in moving the materials and products, within and the organisation.

These logistics activities and functions all together foster the effect of business performance at large. The performance is vital in the success of the business and of the customer (Choughri & Abdullah, 2016). This performance 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 performance such as trust, commitment, information sharing, supplier development and joint product development. Since logistics activities are also part of the organisational functions, it could be inferred that inbound logistics may also impact the performance (Ghoumrassi & Tigu, 2017). But we are lacking scientific proven knowledge regarding the effect of inbound logistics on the performance. Over the years, different studies have revealed factors influencing the performance including customer services, shortage lead time, and good delivery terms (Sumit,2015)). Most of these researchers recommended that the logistics activities have to be customised to enable a strong and beneficial performance. Contrary other studies revealed that, inbound logistics such as transportation, inventory control, and warehousing are related to the performance (sales,2013). Unfortunately, the studies ended by agreeing to the presence of the relationship between the states variable without considering the impact level. What is still missing in the supply chain literature is the effect of logistics activities (inbound) toward the performance. This motivated the researcher to conduct the study and cover the missing literature gap on the effect of inbound logistics activities towards improvement of performance.

One way of analysing the inbound logistics is to see how to apply the current trade standards, terms of delivery, the incoterms, since the global sourcing environment is a fact, it is becoming more and more important to understand what effect the incoterms have on the total cost of the product and delivery. By exercising greater control of the inbound logistics, a firm can leverage its buying power when purchasing its own transportation. It can also consolidate shipments from from multiple shippers that previously would have arranged their freight individually.

In addition, a company works directly with the hauler, instead of making a booking with the supplier and waiting for them to come. The supplier cost is reduced since the supplier is not responsible and an on-time delivery can be guaranteed. Furthermore, accurate delivery times reduced the amount of inventory that must be kept in stock.

As the majority of wholesale companies today, COGENI puts a lot of focus on customers satisfaction, and the deep collaboration that the company has with its customers in, among others, product development area. Resources are always out on the development of the future technologies and solutions that customers require now and might require in the future. Logistically, customer satisfaction has been and still is the most important task for COGENI logistics services, which handles the outbound flow of the COGENI product/inventory. The customer gets the right product on time, in the right quantities, at the right place and at the right cost. The customers need should be met in every way possible.

There are a growing number of companies that are beginning to focus on inbound logistics, due to the economic environment and competitive landscape that are forcing companies to find new ways to reduce costs and improve productivity. It is difficult to get an over view of inbound transportation and find out how these should be carried out in the most favourable way, since no standardised routines or common policies for decision of suitable terms of delivery have been used throughout all purchasing activities in companies. To achieve this, a mapping of current deliveries and terms of delivery have been used throughout all purchasing activities in companies. Hence, following relevant questions are raised; inbound logistics characteristics, what are the main characteristics of the inbound logistics flow, from external suppliers to COGENI warehouse, today?

More specifically, the mapping of the current inbound logistics flows, quantities, frequencies, cost structure and terms of delivery used is to be performed. It is important to map the characteristics of the inbound logistics flow in order to get an understanding of the logistics systems. Terms of delivery: which delivery and condition term is most advantageous for the inbound transportation from external suppliers to COGENI? The data obtained in the mapping part of the thesis is studied by comparing different alternatives and presenting a recommendation that enables COGENI to establish a most advantageous policy for choosing most suitable terms of delivery for inbound logistics flow. This leads to the main problem definition, that is: Evaluate potential for improvement of the inbound flows within the company, mainly with regards of terms of delivery conditions and this affecting the performance of the company.

Am effective inbound logistics program can result in higher quality product, more cost savings and increased sales. It would also improve customer satisfaction, while also reducing total overhead cost and waste materials. Improvement within inbound logistics have a direct effect on customer service. As the stress and cost of inbound freight management decreases, customers realise better service levels; reduce costs and benefits of working with a given company. Therefore, they are more likely to shop with you, not your competitors.

Inbound logistics is an aspect in all organisations because materials flow into an organisation. The quality of materials that flow into an organisation will determine the performance of that organisation. Different strategies such as the use of different machines to carry the materials carefully into the organisation to prevent harm/or damages to materials. If the inbound of materials is poor, it will affect suppliers-customers relationship, because they will not meet up with customers’ demand.

1.3 Research Questions

1.3.1 Main Research Question

What is the effect of inbound logistics activities on organisational performance of COGENI branch Limbe?

1.3.2 Specific Research Question

1. What is the effect of communication on organisational performance of COGENI branch Limbe?
2. To what extent does sourcing materials affect organisational performance of COGENI branch Limbe?
3. To what extent does delivery time affect the organisational performance of COGENI branch Limbe?

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