Effect of outsourcing on performance of logistics industry in Kenya

Abstract

The research was undertaken to explore the extent of outsourcing of the logistics function within the logistics industry. The research included a study of the effect of order processing, warehousing, packaging and transport logistics outsourcing on the performance of the logistics in Kenya. The population of the study were logistics companies in Kenya. Taking logistics companies based in Nairobi to be representative of the rest of the country, the study employed random sampling to arrive at a sample of 96 companies. Data was collected by means of in-depth questionnaires with senior management staff representing the players in logistics industry. The response rate was 73%. The findings of the research demonstrated that the industry players outsourced order processing, warehousing, packaging and transport logistics albeit partially. Order processing, warehousing and transport logistics outsourcing were found to have a statistically positive effect on the performance of the logistics industry in Kenya.