The Nexus of Logistics Capabilities on Firm Performance: An Empirical Study on Logistics Service Providers’ Perspective

Abstract

Despite their profitability, logistics service providers (LSP) face inefficiencies and instability. There is a need to scrutinize the factors that affect how well LSP performs. But, the research related to logistics is scarce. This research aims to create a model that incorporates factors related to logistics capabilities to influence and enhance logistics performance. Partial least square-structural equation modelling (PLS-SEM) was used to evaluate the data collected from 127 LSPs from the Federation of Malaysian Freight Forwarders Malaysia 2021/2022. The results show that the majority of the antecedents of logistics capabilities are significantly related to logistics performance of LSP. However, logistics flexibility capability fails to relate to logistics performance. This study fills the existing knowledge gaps and enhances our comprehension of the antecedents influencing logistics performance. This is because there is a little empirical study on logistics performance outside manufacturing and retailers. Therefore, this study is dedicated to LSP. The limitation of this study is that the customers or clients of LSP are not included in the population. Thus, the result of the study cannot be tallied up with logistics performance and customer satisfaction.