Outbound Logistics Management in Manufacturing Companies in Ghana

By Kwateng, Kwame Owusu; Manso, John Frimpong et al. | Review of Business & Finance Studies, January 1, 2014 | Go to article overview

Outbound Logistics Management in Manufacturing Companies in Ghana


Kwateng, Kwame Owusu, Manso, John Frimpong, Osei-Mensah, Richard, Review of Business & Finance Studies


ABSTRACT

The optimization of outbound logistics operations through consolidation and collaboration using a third party logistics provider has potential to contribute to the profitability of an organization by lowering the cost of warehousing and transportation. The purpose of this paper is to assess outbound logistics of a manufacturing company (Guinness Ghana Breweries Limited) using the services of a third party logistics provider (DHL). Empirical research was employed to explore outbound logistics performance of the manufacturing company. Structured questionnaires were used to capture the perception of staff of GGBL regarding outbound logistics performance of the services of the third party logistics provider. The study revealed there was not much significant change in the supply chain performance measure of outbound logistics activities for the services of DHL to GGBL. Suggestions for improving the issues captured are provided. The performance measurement construct obtained from the study can be used by management of GGBL to perform routine assessment and evaluation of outbound logistics activities to improve supply chain performance of the organisation.

JEL: M12, 032

KEYWORDS: Supply Chain Management, Outbound Logistics System, Supply Chain Operations Reference Model (SCOR Model), Guinness Ghana Breweries Limited

INTRODUCTION

Emerging global competition has made it possible for logistics companies to improve their warehousing and distribution services. Most organizations have made it clear by designing and operating a customized warehousing and distribution service that deliver great benefits. There has been more focus on operational excellence which implies you must consistently deliver quality service across all operations. Many manufacturing companies are now outsourcing their outbound logistics, because they cannot do it themselves and remain competitive. They began to look to third party specialist to perform activities that were not a part of their core competency (Grant et al., 2006). A company like DHL global has the know-how and experience necessary to design and manage warehouse and distribution processes, so product flows are optimized and supply cost are driven down. Customers can reduce their stockholding and increase service levels, while maintaining the flexibility required for meeting fast-changing market demands. Brewery has a long supply chain management processes from inbound, operations and outbound logistics activities. Most third party logistics providers in Ghana specialize in warehousing and distribution as their core business. Being motivated by the rapid increase in warehousing and distribution services in Ghana and worldwide, the research seeks to identify how this is managed in a third party logistics company. The logistics provider restructures warehousing activities as well as distribution network to gain a competitive advantage for itself and the outsourcing company.

Most third party logistics company like DHL have experienced some challenges managing warehousing and distribution services in some manufacturing companies like breweries. It is necessary to study challenges in the outbound logistics of a manufacturing company and develop strategies to overcome challenges. Most manufacturing companies have not been able to successfully maximize their potential in outbound logistics in terms of warehousing and distribution. They have not critically assessed the performance of their outbound logistics efficiency. It is essential to conduct scientific research to identify know how warehousing and distribution is managed and also understand all associated challenges and how they are resolved. It is important to know whether manufacturing companies benefit when they engage third party logistics in their warehousing and distribution activities.

The study examined how DHL manages the warehousing and distribution of a brewery like Guinness Ghana Breweries Limited (GGBL). …

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