Logistics management practices and customer satisfaction: the mediating effect of logistics service quality among the Shippers in Kenya

Abstract

The key objective of this study was to determine the effect of Logistics Service Quality (LSQ) on the relationship between Logistics Management Practices (LMPs) and customer satisfaction of shippers in Kenya. Subsequently, a hypothesis was formulated to achieve this objective which was: LSQ has no mediating effect on the relationship between LMPs and customer satisfaction. Descriptive crosssectional research design was adopted, and primary data collected from senior managers in the logistics department of the shippers. The study was a census, undertaken on all the 63 importers and exporters who were members of Shippers Council of Eastern Africa (SCEA), which was used as the sampling frame. A 59% response rate was achieved. Customer satisfaction had loyalty and expectations met as the sub-constructs, while LMPs used a composite score of the seven components namely, inventory management, transportation, warehousing, packaging, materials handling, order processing and information flow maintenance. The LSQ was assessed by functional and technical quality. The study findings were statistically significant and there was a positive relationship between LMPs and customer satisfaction. An r-square of .482 meant that 48.2% of variation in customer satisfaction of shippers in Kenya was explained by LMPs and LSQ. Further, the independent variable was significant in the fourth step of the Baron & Kenny (1986) mediation test, resulting to deduction that the relation between LMPs and customer satisfaction was mediated by LSQ. Study findings showed that the sub-construct expectations met had a greater weighting compared to loyalty as a measure of customer satisfaction. On the LSQ, the shippers indicated that they were more satisfied with the functional quality than the technical quality of their logistics service providers. The study supported and contributed to the theories it was grounded on, namely expectancy disconfirmation theory (EDT), material flow theory and systems theory. The contributions of the study to various stakeholders, recommendations and conclusions are highlighted.