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Citation:
Sandar LK (2024). The Effects of Logistics Activities on Performance of Dagon Foods Processing and Canning Factory
(Hlaingtet). SunText Rev Arts Social Sci 5(1): 169.
SunText Review of Arts & Social Sciences Open Access
ISSN: 2766-4600 Research Article
Volume 5:1
The Effects of Logistics Activities on
Performance of Dagon Foods Processing and
Canning Factory (Hlaingtet)
Sandar LK*
Associate Professor (Retired), Yangon University of Education, Myanmar
*Corresponding author: Sandar LK, Associate Professor (Retired), Yangon University of
Education, Myanmar; E-mail: khinsandarlwin.ksdl@gmail.com
Abstract
This study focuses on the effects of logistics activities on firm performance of Dagon Foods Processing and Canning Factory (HlaingTet).
The objectives of the study are to identify the logistics activities of Dagon Foods Processing and Canning Factory, and to analyze the
effects of logistics activities on performance of Dagon Foods Processing and Canning Factory (HlaingTet). There are totally 98
employees in this factory among them, 80 employees are selected by using simple random sampling method. The sample size represents
by 82% of population. The primary data are collected from the owner by in-depth interview and selected employees by conducting
survey through structured questionnaires. The secondary data are obtained from the relevant text books, previous research paper and the
related websites. Descriptive statistics, correlation analysis, and multiple regression analysis are used. The data collection period was
August, 2023. The result of correlation analysis shows that the logistics activities (order processing, inventory management, packaging
and transportation) are positively and strongly correlated with firm performance. The result of multiple regression analysis shows that
order processing, inventory management, packaging and transportation have significant and positive effects on firm performance.
Therefore, Dagon Foods Processing and Canning Factory should emphasize on logistics activities to improve firm performance.
Keywords: Order processing; Packaging; Inventory management; Transportation; Firm performance
Introduction
Food is one of the pillars upon which society is built. It is
fundamental to health, happiness and political stability. The food
industry has developed massively, from the fundamentals of
production, harvesting and storage, to a situation where
productivity is enhanced through genetics, chemistry,
mechanization and management. Food processing industries are
today facing increasing levels of competitive pressure and
difficulty with regard to maintaining and improving profitability.
Manufacturing firms can gain competitive advantage through a
well-designed logistics management because logistics include all
activities from the source of origin to the end of destination.
Logistics supports the firm by providing products or services in an
efficient manner, which is both important for financial gain and
support the objectives of the firm. Within the business sector,
logistics can be applied to transportation, warehousing and storage,
industrial packaging, material handling, inventory control, order
fulfillment, demand forecasting, production planning/scheduling,
procurement, customer service, facility location, return goods
handling, parts and service support, and salvage and scrap disposal.
To be successful, firms must manage their logistics activities,
which enhances efficiency, reduce costs and improve performance.
Logistics management has to do with acquiring the sufficient
resources at the right quantity, place, price, and time. Ideally,
manufacturers should take advantage of latest business innovations
to drive overall performance (Bello & Adeoye, 2018), and one area
where such intervention enhances performance is in logistic
activities, such as transportation, inventory management,
warehousing, material handling and other logistic activities. Dagon
Foods Processing and Canning Factory (HlaingTet) is the private
food processing firm. This factory is situated at HlaingTet village,
Thazi Township, Meiktila District, Mandalay Division in
Myanmar. It products fruit juice, dried fruit, jam, sauce, and
dehydrated vegetables. Therefore, this study analyzes the logistics
Received date: 29 January 2024; Accepted date: 21
February 2024; Published date: 28 February 2024
Citation: Sandar LK (2024). The Effects of Logistics
Activities on Performance of Dagon Foods Processing
and Canning Factory (Hlaingtet). SunText Rev Arts
Social Sci 5(1): 169.
DOI: https://doi.org/10.51737/2766-4600.2024.069
Copyright: © 2024 Sandar LK. This is an open-access
article distributed under the terms of the Creative
Commons Attribution License, which permits
unrestricted use, distribution, and reproduction in any
medium, provided the original author and source are
credited.
Sandar
, SunText Rev Arts Social Sci (2024), 5:1
Citation:
Sandar LK (2024). The Effects of Logistics Activities on Performance of Dagon Foods Processing and Canning Factory (Hlaingtet).
SunText Rev Arts Social Sci 5(1): 169.
and firm performance of Dagon Foods Processing and Canning
Factory (HlaingTet).
Rationale of the Study
In developing countries, agriculture plays a crucial role in the
economy and provides the main source of food, income and
employment to their rural populations. Agriculture sector is the
backbone of Myanmar’s economy. The agriculture sector
contributes to 37.8 percent of gross domestic product (GDP),
accounts for 25 to 30 percent of total export earnings and employs
70 percent of the labour force. Integration of production agriculture
with on-farm primary processing is needed to have higher and
sustainable production, productivity, and better quality end
products for domestic and export markets. Fruit and vegetable
processing projects also aim to replace imported products, like
squash, jams, tomato sauces, etc., besides earning foreign exchange
by exporting finished or semi-processed products. Additionally,
the food processing industry is an important economic segment,
contributing to Myanmar in terms of employment creation,
provision of food which is a basic necessity and generating
substantial revenue for the country. According to this condition, the
aim of this study is to investigate logistics management problems
and their influence on business performance in the food processing
industry. And this foods processing and canning factory also
provide not only an economics growth but also foreign currency
can increase and develop for GDP of Myanmar. Therefore, this
study emphasizes to identify how order processing, inventory
management, packaging, and transportation effect the firm
performance of foods processing and canning factory. As a food
processing industry, Dagon Foods Processing and Canning Factory
produces a variety products ranging from Cordial, Jams, Juice,
Sauce, dehydrated fruits and vegetables, Herbal Raw for medicine
and concentrate, and these products are also exported to Japan,
Korea, Singapore, and Thailand. The efficiency and effectiveness
of Dagon Foods Processing and Canning Factory’s logistics
operation has a considerable influence not only on the business
performance of the manufacturer but also on the customer’s
perception of the quality of the products and services provided by
the manufacturer. For this reason, in order to get competitive
advantages through firm performance, Dagon Foods Processing
and Canning Factory has to implement logistics activities.
Objectives of the Study
The objectives of the study are:
1. To identify the logistics activities of Dagon Foods
Processing and Canning Factory (HlaingTet).
2. To analyze the effects of logistics activities on
performance of Dagon Foods Processing and Canning
Factory (HlaingTet).
Scope and Methods and Limitations of the Study
This study focused on logistics activities and performance of
Dagon Foods Processing and Canning Factory (HlaingTet). As the
population, there are totally 98 employees in Dagon Foods
Processing and Canning Factory (HlaingTet). Among them, 80
employees are selected as respondents by using simple random
sampling method which represented by 82% of population. The
primary data are collected from 80 employees by distributing
structured questionnaires. The secondary data are obtained from
factory’s records and annual report, documents provide by the
factory, and internet websites. The collected data are analyzed by
using descriptive statistics, correlation analysis, and multiple
regression analysis. Generally, there are fourteen logistics
activities. Among them, the present limitation of the study is that
focuses on logistics activities (order processing, inventory
management, packaging and transportation). The survey period
was conducted in August, 2023. The data are only collected from
80 employees of Dagon Foods Processing and Canning Factory
(HlaingTet). Their perception on firm performance may be
different from respondents of other food processing industries.
Concept of Logistics Management
Council of Logistics Management (1991) defined that logistics is
‘part of the supply chain process that plans, implements, and
controls the efficient, effective forward and reverse flow and
storage of goods, services, and related information between the
point of origin and the point of consumption in order to meet
customers’ requirements. Logistics management is that part of the
supply chain process that plans, implements, and control the
effective flow and storage of goods, service, and related
information from point-of-origin to the point-of-consumption in
order to meet customers’ requirements [1]. The logistics of
physical items usually involves the integration of information flow,
material handling, production, packaging, inventory,
transportation, warehousing, and often security [2]. Logistics is a
link between the market place and the operating activity of the
business. The scope of logistics spans the organization, from the
procurement and management of raw materials through to the
delivery of the final product. Logistics plays a huge role within
today’s economy. Today, companies have good infrastructure and
record keeping, which continues to improve through advancements
in technology. This means that logistics has an impact on the
shipment of goods and how quickly they can get to the consumer,
again adding a competitive edge to other businesses [3].
Logistics Activities
The elements of the logistics activities must work as a unit to
achieve the greatest ability to unite and work together. For
logistical activities, important factor is the ability to respond
Sandar
, SunText Rev Arts Social Sci (2024), 5:1
Citation:
Sandar LK (2024). The Effects of Logistics Activities on Performance of Dagon Foods Processing and Canning Factory (Hlaingtet).
SunText Rev Arts Social Sci 5(1): 169.
quickly to market changes, as well as take into account the various
changes in the environment. Due to these features, all the elements
of logistics activities represent a single activity having a feedback
and flexible in responding to what is happening described the
fourteen logistics activities [4,5]. These activities are materials
handling, transportation, warehousing and storage, inventory
management, packaging, order processing, demand forecasting,
production planning, purchasing, customer service levels, plant
and warehouse site location, return goods handling, part and
service support, and salvage and scrap disposal. Among them, this
study focuses such as order processing, inventory management,
packaging and transportation.
Order Processing
Order processing is the process or work flow from order placement
to delivery. This is a key element of retail order fulfillment, where
reliability and accuracy lead to customer satisfaction. Steps in order
processing include picking, sorting, tracking and shipping. Order
processing can range from manual processes (hand written on an
order log sheet) to highly technological and data-driven processes
(through online orders and automated order processing software)
depending on the operation [6]. Order Processing is important in
logistics because it’s an organized and effective procedure in take
care of customer orders. As a consequence, efficient processing of
orders will lead to increased sales and higher customer
satisfaction.Each order is assigned a tracking number which is then
shared (either manually or automatically, depending on the
software) with the customer, allowing them to see the status of their
order every step of the way. Finally, items are delivered to the end
customer [6]. Order processing includes activities for receiving,
handling, filing, recording of orders. Management has to ensure
that order processing is accurate, reliable and fast. Delays in
execution of orders can become serious grounds for customer
dissatisfaction; which must be avoided at all costs [7]. Because the
order processing cycle is a key area of customer interface with the
organization, it can have a big impact on a customer’s perception
of service, and therefore satisfaction [1].
Inventory Management
Drury (1996) defined inventory as a stock of goods that is
maintained by a business in anticipation of some future demand.
Inventory management is an accounting term that refers to goods
that are in various stages of being made ready for sale, including
finished goods (that are available to be sold), work-in-progress
(meaning in the process of being made) and raw materials (to be
used to produce more finished goods). According Chase et al,
inventory is the stock of any item or resource used in any
organization. An inventory system is the set of policies and
controls the minor levels of inventory and determine what levels
should be maintained, when stock should be replenished and how
large order should be [8].
Inventory management is of great importance especially for
managers who must decide how much to hold and how to
administer the rest of the logistics system more creatively in order
to ensure that customer service does not suffer as a result of lower
inventory levels. That’s the reason why inventory management
requires a particular attention or the support of the entire
company’s management levels in order to meet customers’
satisfaction [9]. When making decisions on inventory,
management has to find a compromise between the different cost
components, such as the costs of supplying inventory, inventory-
holding costs and costs resulting from insufficient inventories [8].
Packaging
Packaging is a fairly new concept that has during the last years
developed and gained increased attention by both industry and
scientific community [10]. Product packaging has earned a great
emphasis today because these factor considered safe to use by the
consumers. Food packaging has four main functions: containment,
protection, convenience and communication; all of them are
correlated to each other and need to be considered during the
packaging development process [11]. Packaging can be described
as a coordinated system of preparing goods for transport,
warehousing, logistics, sale, and end use. Packaging contains,
protects, preserves, transports, informs, and sells [12]. Packaging
also affects supply chain effectiveness because it represents an
interface between the supply chain and its main customer: the end
user and enables the chain’s primary task i.e. serving end
consumers, to be accomplished. This is especially evident in the
Fast Moving Consumer Goods supply chain [13].
Transportation
Transportation physically moves product from where they are
produced to where they are needed. This movement across space
or distance adds value to products. This value is often referred to
as place utility. Transportation is also a factor in time utility, it
determines how fast and consistently a product moves from one
point to another [14]. Transportation is the most significant area of
logistics because of the impact on customer service level and cost
structure. Without well-developed transportation systems, logistics
could not bring its advantages into full play. Besides, a good
transport system in logistics activities could provide better logistics
efficiency, reduce operation cost, and promote service quality. A
well-operated logistics system could increase both the
competitiveness of the government and enterprises [5]. Nowadays,
organizations are concerned about transportation management
because transportation represents a major expense item. And, the
transportation system is the physical link connecting a firm’s
customers, raw material suppliers, plants, warehouses, and channel
Sandar
, SunText Rev Arts Social Sci (2024), 5:1
Citation:
Sandar LK (2024). The Effects of Logistics Activities on Performance of Dagon Foods Processing and Canning Factory (Hlaingtet).
SunText Rev Arts Social Sci 5(1): 169.
members. In addition, a good transport system performing in
logistics activities brings benefits not only to profitability but also
to company competitiveness [3].
Firm Performance
The concept of firm performance has received various
interpretations over the years. Some look at the firm performance
to mean the development of share prices, while others viewed it in
terms of profitability [15]. A firm’s marketing performance
indicates how productive its marketing activities are with regards
to its marketing goals, which is influenced by the firm’s
characteristics, approach, internal and external environment,
resources and other qualities/characteristics of the shareholders and
management of the firms. The most notable performance measures
of a firm are financial and non-financial measures, and in strategic
management research, firm performance is frequently used as a
dependent variable [16]. According to the Richard et al, firm
performance encompasses three specific areas of firm outcomes:
financial performance (profits, return on assets, return on
investment), market performance (sales, market share), and value
added. Firm performance include return on asset, return on
investment, market share, sale growth, customer satisfaction, cost,
employee satisfaction, lead time and profit. Firm performance
comprised the actual output or results of an organization as
measured against its intended outputs (or goals and objectives), it
involved the recurring activities to establish organizational goals,
monitor progress toward the goals, and make adjustments to
achieve those goals more effectively and efficiently [17].
Conceptual Framework of the Study
Based on the results of literature review, it can be constructed a
conceptual framework. This study only focuses on the logistics
activities as inventory control, transportation, packaging, and order
fulfillment in the field of foods processing and canning factory.
The conceptual framework of the study is shown (Figure 1).
According to Figure (1), order processing, inventory management,
packaging, and transportation are independent variables and firm
performance (increasing sale volume, productivity, revenue,
reduced cost and saving time) is dependent variable. The main
purpose of this research is to find out whether the logistics
activities have a significant effect and subsequently helps firm to
improve firm performance of Dagon Foods Processing and
Canning Factory.
Logistics Activities of Dagon Foods Processing and
Canning Factory (HlaingTet)
The factory is practicing four logistics activities according to
business nature, such as order processing, packaging, inventory
management, and transportation.
Figure 1: Conceptual Framework of the Study
Order Processing
Order processing activities is important for food processing and
canning factory. The factory has to deliver the products to the
customers when the customers want. And the factory has to handle
concerning with the ordering materials. Firstly, it collects the
orders from customers and then the customers’ orders are fulfilled.
The factory directly fulfill the customer’s orders to sites in
previously connected townships and also give the service delivery
to the public transportation gate for the customers from other cities.
Moreover, the factory also delivers orders through Global Sky
Company Limited for distribution in Yangon. The Global Sky
Company Limited is the main distributor of Dagon Foods
Processing and Canning Factory. The factory always careful to
deliver the right quality of products what the customer order and
perform the customer order on time.
Inventory Management
According to the business nature, Dagon Foods Processing and
Canning factory has cold storage room to store fruits pulp and
semi-finished products in order to produce jam. The workers to
warehousing department are responsible to entry daily stock in and
stock out according to their stock form. Therefore, inventories are
used not only for storing raw materials or finished products but also
receiving products from multiple suppliers. In addition, factory
uses first-in, first-out (FIFO method) for raw materials and finished
goods. The warehousing department of Dagon Foods Processing
and Canning factory is one of the main activities in operation of the
firm. There are four warehouses to store and distribute the products
to require destination smoother and faster without any damage. The
warehouse that stored raw materials, semi-finished and finished
products locate nearly in the plant. Raw materials are stored
according to product categories. Finished products are also stored
with suitable shelves and placed according to product names. The
employees of warehousing department are responsible for
Sandar
, SunText Rev Arts Social Sci (2024), 5:1
Citation:
Sandar LK (2024). The Effects of Logistics Activities on Performance of Dagon Foods Processing and Canning Factory (Hlaingtet).
SunText Rev Arts Social Sci 5(1): 169.
verifying the quantities and quality of raw materials and finished
products before receipting. After checking, the employees have to
place the materials according to their products category. The
employees have to place the materials according to their receipting.
After checking, the employees have knowledge of the expiration,
weight and size of each product to store and manage raw materials
and finished products. Dagon Foods Processing and Canning
factory’s inventory management helps their product demand and
take inventory control has to do with keeping accurate records of
goods that are ready to transport. Therefore, factory has no delays
in delivery of products due to sufficient inventories.
Packaging
The packaging serves the important function of containing the
food, protecting against chemical and physical damage whilst
providing information essential to consumers and marketers.
Dragon Foods Processing and Canning Factory’s packaging plays
important role in the smooth transfer to finished goods from plant
to the distribution center and customer locations. Firstly, these
items are picked from the shelves and placed to the packaging area.
After packaging, the firm distributes to customers. Dragon Foods
Processing and Canning Factory packed its products with plastic
bag, cans, glasses and carton box. And factory’s main packaging
materials are plastics and tinplate steel. Plastic can protect water.
Due to pitting resistance and quality surface finish it is easy to clean
and maintain. Moreover, tinplate steel does not change the color,
taste or smell of the canning food. The purpose of their packaging
is to protect from damaging, temperature shocks during
transportation and it is easy to handle during the movements from
point to point and minimizing of space in warehouse.
Transportation
Transportation of Dagon Foods Processing and Canning factory
provides the essential service of linking factory to its suppliers and
customers. There are five ways of transportation such as rail, road,
ship, air and pipeline. Dagon Foods Processing and Canning
factory is especially using road way. The factory has chosen road
way for both inbound and outbound transportation in daily
activities. The factory uses private transportation service firms and
public transportation for delivery system. The factory uses
transport schedule to deliver finished goods to customer's right
time, right place and right product. The firms always check
vehicle condition to smooth transportation. And they also use lead
time to effective and efficient transportation channels. Therefore,
the factory can reduce transportation time and cost and also they
can arrange on time delivery of customers order.
Performance of Dagon Foods Processing and
Canning Factory (HlaingTet)
Logistics activities are accelerated the operation performance.
Reducing cost of each outbound logistics activities influence the
total amount of costs and enhance firm’s performance. The main
goal of the firm is to maximize the revenue and sale maximization.
Profit maximization is to maximize the present value of the firm
and try to maximize sale growth. Firm performances are measured
by the improvement in productivity. Dagon Foods Processing and
Canning Factory have produced the products based on the orders
from Dagon Foods Company. Dagon Factory has been gaining the
increase in sale growth through the logistics activities within from
2015-2016 to 2018-2019. Dagon factory has been gaining
improvement in productivity through the logistics activities within
four years from 2015-2016 to 2018-2019. This means improving
in the strength to determine the productivity in the factory. Then,
the factory’s annual production units are also seen in the following
(Table 1). According to Table (1) performance of Dagon Foods
Processing and Canning factory can be measured by productivity
in Tons. According to this data, firm performance has increased
over last five years and the logistics activities were developed in
Dagon Foods Processing and Canning factory.
Table 1: Annual Production (Tons) of Dagon Foods Processing and
Canning Factory
Sr.
No.
Years
Production
(Tons)
1
2015-2016
130
2
2016-2017
153
3
2017-2018
214
4
2018-2019
240
Source: Dagon Foods Processing and Canning
factory (August,2023)
Analysis of Logistics Activities and Performance of
Dagon Foods Processing and Canning Factory
Demographic profile of respondents include gender, age, marital
status, education level, position, income level and working
experience. To analyze the effects of logistics activities on
performance of Dagon Foods Processing and Canning Factory
(HlaingTet), frequency distributions of seven demographic factors
for 80 respondents are shown in the following Tables (Appendix
A). Analysis of Respondent Perception on Logistics Activities and
Performance This section is to analyze the effects of logistics
activities on firm performance of Dagon Foods Processing and
Canning Factory (HlaingTet).
Reliability of the Variables
This section is to analyze the effects of logistics activities on
performance of Dagon Foods Processing and Canning Factory
Sandar
, SunText Rev Arts Social Sci (2024), 5:1
Citation:
Sandar LK (2024). The Effects of Logistics Activities on Performance of Dagon Foods Processing and Canning Factory (Hlaingtet).
SunText Rev Arts Social Sci 5(1): 169.
(HlaingTet). Firstly, descriptive statistics, reliabilities, the mean
values of the factors, and correlations were calculated. Before the
reliability analysis, four components of the logistics activities were
measured with 25 items, firm performance was measured with
eight items. According to the results of the reliability analysis of
the variables, all items of each variable support the acceptable level
of reliability test. Cronbach (1951) described reliability is the
overall consistency of a measure [18- 32]. The alpha value for each
question is identified and summarized, which shows the
reliabilities (Alpha values) of the variables (Table 2). Table (2)
presents Cronbach’s alpha value for each item: order processing,
packaging, inventory management and transportation and firm
performance from 0.600 to 0.744. The reliability of order
processing is 0.600, the reliability of packaging is 0.794, the
reliability of inventory management is 0.745, the reliability of
transportation is 0.813 and the reliability of firm performance is
0.744. Therefore, the alpha values of all variables have reliable and
acceptable levels.
Table 2: Reliability of the Variables.
Sr.
No.
Logistics
Activities
Items
Cronbach’s
Alpha
1
Order
Processing
6
0.600
2
Inventory
Management
7
0.745
3
Packaging
7
0.794
4
Transportation
5
0.813
5
Firm
Performance
8
0.744
Source: Survey Data (August, 2023)
Summary of Respondent Perception on Logistics
Activities
In studying order processing, packaging, inventory management
and transportation are focused and presents overall employee
perception on logistics activities (Table 3). Table (3) describes the
overall mean values of order processing, packaging, inventory
management and transportation. The maximum mean value of
order processing is 4.04, it means because employees accept
fulfilling the right quality of customer’s order product, always
accepting customer order exactly with required information (date,
time, place, product, type with comments) and performing
customer order just-in-time. Although the minimum mean value of
inventory management is 3.88, it shows the agree level.
Table 3: Summary of Respondent Perception on Logistics Activities.
Sr.
No.
Particular
Mean
SD
1
Order Processing
4.04
0.614
2
Inventory
Management
3.88
0.583
3
Packaging
4.01
0.559
4
Transportation
3.92
0.652
Source: Survey Data (August, 2023)
Table 4: Respondent Perception on Firm Performance.
Sr.
No.
Description
Mean
SD
1
Increasing revenue by
performing customer’s
order on time
4.15
0.638
2
Increasing sale value
by using order
processing software
3.61
0.907
3
Reducing
transportation cost by
using good quality
packaging
4.25
0.666
4
Saving time and cost
by using automatic
packing machines
3.88
0.848
5
Reducing storage cost
due to use effective
inventory management
and production
planning
4.01
0.864
6
Increasing
productivity by using
systematically
inventory control
4.03
0.729
7
Increasing
productivity by using
annual transportation
planning
3.99
0.755
8
Saving time and cost
by using transportation
schedule
4.29
0.679
Overall Mean
4.02
Source: Survey Data (August, 2023)
Sandar
, SunText Rev Arts Social Sci (2024), 5:1
Citation:
Sandar LK (2024). The Effects of Logistics Activities on Performance of Dagon Foods Processing and Canning Factory (Hlaingtet).
SunText Rev Arts Social Sci 5(1): 169.
Respondent Perception on Firm Performance
Firm performance factors were measured with eight statements.
The results in the table show the mean values and overall mean
value concerning firm performance of logistics activities in the
factory. The overall mean score is 4.02 and it can be concluded
respondents are agreed with their performance at factory. The
maximum mean of 4.29 shows that the factory has saving time and
cost by using transportation schedule over last five years. The
minimum mean value of 3.61 shows that agree level of
respondents. It means that the factory has increased sale value by
using order processing software over last five years (Table 4).
Correlation Analysis of Logistics Activities and
Performance
After the reliability, correlations of independent variables (order
processing, packaging, inventory management and transportation)
are tested to show their correlation with dependent variable (firm
performance). Correlation is the statistical technique that can show
whether and how strongly pairs of variables are related. Correlation
coefficient ranges from -1.0 to +1.0. As the correlation coefficient
value goes toward 0, the relationship between the two variables
will be weaker. The direction of the relationship is indicated by the
sign of the coefficient; a (+) sign indicates a positive relationship
and a (-) sign indicates a negative relationship. If the value is
positive, it means that as one variable gets larger, the other gets
larger. If the value is negative, it means that one variable gets
larger, the other gets smaller. The results of the correlations of the
measured variables are shown (Table 5).
Table 5: Correlation between Logistics Activities and Performance.
Sr.
No.
Logistics
Activities
Pearson
Correlation
Coefficient
P-
value
1
Order
Processing
0.474**
0.000
2
Inventory
Management
0.748**
0.000
3
Packaging
0.729**
0.000
4
Transportation
0.653**
0.000
Source: Survey Data (August, 2023)
**Correlation is significant at the 0.01 level (2-tailed)
Multiple Regression Analysis of Logistics Activities
and Performance
As the main analysis, the study was applied regression analysis to
test the objective of the effects of logistics activities (order
processing, packaging, inventory management and transportation)
and firm performance. Multiple regression analysis is conducted to
test the proposed objectives. The results of the multiple regression
analysis are shown (Table 6).
P < 0.05; Dependent variable: Firm Performance
The propose Model is
The estimate model is,
y = a+ b1X1+b2X2+ b3X3+ b4X4
where,
y = Firm Performance
a = Constant (intersection)
b = Coefficient (the slope of the regression)
X1 = Order Processing
X2 = Inventory Management
X3 = Packaging
X4 = Transportation
εi = Random error
Thus, the regression equation is;
Firm Performance = 0.560 + 0.187 Order Processing + 0.296
Inventory Management
+ 0.216 Packaging + 0.176 Transportation
According to the results in Table (6), the model explains that the
variation in overall level of performance exists as R square value
is 64 percent. This indicates that independent variables can explain
64 percent variation in dependent variable. If the company has
emphasized the logistics activities (order processing, inventory
management, packaging and transportation) the performance will
have been 0.560. Among the logistics activities, the factory gets
more performance as the results of order processing, inventory
management, packaging and transportation. According to the
results among logistics activities, order processing, inventory
management, packaging and transportation show the positive and
significant effect on performance. The results show that order
processing has positive and significant effect on firm performance
because its p-value is 0.024. It shows that the amount of firm
performance would increase by every unit change in the factor of
order processing when all other variables are constant. This implies
that there is a positive and significant effect of order processing on
firm performance at 5% significant level. One additional unit of
order processing increased 0.187 times in performance.
The results show that inventory management has positive and
significant effect on firm performance because its p-value is 0.018.
It shows that the amount of firm performance would increase by
every unit change in the factor of inventory management when all
other variables are constant. This implies that there is a positive
and significant effect of inventory management on firm
performance at 5% significant level. One additional unit inventory
Sandar
, SunText Rev Arts Social Sci (2024), 5:1
Citation:
Sandar LK (2024). The Effects of Logistics Activities on Performance of Dagon Foods Processing and Canning Factory (Hlaingtet).
SunText Rev Arts Social Sci 5(1): 169.
management increased 0.296 times in performance. The results
show that packaging has positive effect on firm performance
because its p-value is 0.062. It shows that the amount of firm
performance would increase by every unit change in the factor of
packaging when all other variables are constant. This implies that
there is a positive and significant effect of packaging on firm
performance at 10% significant level. One additional unit of
packaging increased 0.216 times in performance. The results show
that transportation has positive and significant effect on firm
performance because its p-value is 0.027. It shows that the amount
of firm performance would increase by every unit change in the
factor of transportation when all other variables are constant. This
implies that there is a positive and significant effect of
transportation on firm performance at 5% significant level. One
additional unit of transportation increased 0.176 times in
performance.
Table 6: The Effect of Logistics Activities on Firm Performance.
Model
Unstandardized
coefficients
Standardized
Coefficients
t
Sig
B
Std.
Error
Beta
(constant)
0.560
0.327
Order Processing
0.187
0.081
0.185
2.306
0.024
Inventory Management
0.296
0.123
0.310
2.412
0.018
Packaging
0.216
0.114
0.235
1.893
0.062
Transportation
0.176
0.078
0.235
2.255
0.027
R2
0.645
Adjusted R2
0.626
Source: Survey Data (July, 2020)
Table 7: Order Processing
Sr.
No.
Statement
Perception
1
The factory provides customer’s order product with period of time.
1
2
3
4
5
2
The factory can perform customer order just-in-time.
1
2
3
4
5
3
The factory uses order processing software to reduce errors in
maintaining order detail.
1
2
3
4
5
4
The factory staffs always accept customer order exactly with required
information (date, time, place, product, type with comments).
1
2
3
4
5
5
The factory services ordered product with standard quality.
1
2
3
4
5
6
The factory fulfills the right quality of customer’s order product.
1
2
3
4
5
Table 8: Inventory Management
Sr.
No.
Statement
Perception
1
Factory uses effective inventory management and production planning.
1
2
3
4
5
2
Factory keeps inventory record by manually.
1
2
3
4
5
3
Factory also uses inventory control software.
1
2
3
4
5
4
Factory uses just-in-time inventory management practices to reduce inventory
costs.
1
2
3
4
5
5
Inventories are systematically stored at the factory depend on the type of the
product.
1
2
3
4
5
6
Factory has sufficient warehouses to maintain raw materials.
1
2
3
4
5
Sandar
, SunText Rev Arts Social Sci (2024), 5:1
Citation:
Sandar LK (2024). The Effects of Logistics Activities on Performance of Dagon Foods Processing and Canning Factory (Hlaingtet).
SunText Rev Arts Social Sci 5(1): 169.
7
The responsible person usually checks inventory balance for warehousing and
storage activities.
1
2
3
4
5
Table 9: Packaging
Sr.
No.
Statement
Perception
1
Packaging protects physical accidents and barriers.
1
2
3
4
5
2
Packages and labels give exact information to customer how to use.
1
2
3
4
5
3
The factory always uses the good quality packaging materials.
1
2
3
4
5
4
The factory uses IT technology, electronic machines and automatic packing
machines.
1
2
3
4
5
5
The factory uses tinplate steel (safety pack of product and safety first of customer)
packing material.
1
2
3
4
5
6
The factory’s product has attractive packaging design.
1
2
3
4
5
7
The factory uses the good quality of plastic packaging system approved by FDA.
1
2
3
4
5
Table 10: Transportation
Sr.
No.
Statement
Perception
1
The factory uses the safety and security truck cars for transportation. (public
transportation)
1
2
3
4
5
2
The factory uses transport scheduling to ensure that deliveries are completed in right
time, right place and right product.
1
2
3
4
5
3
The factory prepares an annual transportation planning for saving transportation cost.
1
2
3
4
5
4
The factory regularly checks the track car in order to smooth transportation.
1
2
3
4
5
5
The factory use effective and efficient transportation channels.
1
2
3
4
5
Table 11
Sr.
No.
Statement
Perception
1
The factory has increased revenue by performing customer’s order on time over last
five years.
1
2
3
4
5
2
The factory has increased sale value by using order processing software over last
five years.
1
2
3
4
5
3
The factory has reduced transportation cost by using good quality packaging design
over last five years.
1
2
3
4
5
4
The factory has saving time and cost by using IT technology, electronic machines
and automatic packing machines over last five years.
1
2
3
4
5
5
The factory has reduced storage cost due to use efficient and effective inventory
management and production planning over last five years.
1
2
3
4
5
6
The factory has increased productivity by maintaining efficient and effective
inventory control over last five years.
1
2
3
4
5
7
The factory has increased productivity by preparing detail annual transportation
planning over last five years.
1
2
3
4
5
8
The factory has saving time and cost by using transportation schedule over last five
years.
1
2
3
4
5
Sandar
, SunText Rev Arts Social Sci (2024), 5:1
Citation:
Sandar LK (2024). The Effects of Logistics Activities on Performance of Dagon Foods Processing and Canning Factory (Hlaingtet).
SunText Rev Arts Social Sci 5(1): 169.
Sr. No.
Description
Frequency
Percentage
1
Gender of Respondents
Male
33
41.25
Female
47
58.75
Total
80
100.00
2
Age of Respondents
25 to 34 years
42
52.50
35 to 44 years
21
26.25
45 to 54 years
10
12.50
55 years and above
7
8.75
Total
100.00
3
Marital Status of Respondents
Single
21
26.25
Married
59
73.75
Total
80
100.00
4
Educational Level of Respondents
High School
46
57.50
University Students
16
20.00
Graduate
17
21.25
Post Graduate
1
1.25
Total
80
100.00
5
Position of Respondents
Director
1
1.25
Manager
9
11.25
Assistant Manager
12
15.00
Supervisor
16
20.00
General Worker
42
52.50
Total
80
100.00
6
Income Level of Respondents
100,001 - 200,000 Kyats
42
52.50
200,001 - 300,000 Kyats
16
20.00
300,000 - 400,000 Kyats
12
15.00
Above 400,001 Kyats
10
12.50
Total
80
100.00
7
Working Experience of Respondents
1 - 3 years
32
40.00
Sandar
, SunText Rev Arts Social Sci (2024), 5:1
Citation:
Sandar LK (2024). The Effects of Logistics Activities on Performance of Dagon Foods Processing and Canning Factory (Hlaingtet).
SunText Rev Arts Social Sci 5(1): 169.
4 - 6 years
38
47.50
7 years and above
10
12.50
Total
80
100.00
Source: Survey Data (August, 2023)
Among the logistics activities, inventory management had more
supported firm performance than any other factors. According to
the results among the logistics activities, order processing,
inventory management and transportation are appropriate positive
and significant effect on firm performance. This study analyzed
relationship between logistics activities and firm performance. The
result revealed that logistics activities are essential for firm
performance. The final results of the multiple regression analysis
are illustrated in the following (Figure 2).
Figure 2: Conceptual Framework with Results.
According to Figure (2), structural model of logistics activities, the
research finding on the effects of logistics activities and firm
performance of Dagon Foods Processing and Canning Factory
(HlaingTet) is shown as follows. Inventory management shows the
most significant effect on firm performance. Order processing,
packaging and transportation also found that the positive and
significant effect on performance. This study highlights the
importance of order processing, inventory management, packaging
and transportation to increase firm performance.
Conclusion
Dagon Foods Processing and Canning Factory (HlaingTet) uses the
good quality of the raw materials the safe product for customer and
give the safety first for human on the virtual issues by testing and
approving by FDA. Dagon Foods Processing and Canning Factory
(HlaingTet) fulfills customers' products by using the right quality
of products specifically according to recorded data from the order
processing department. And the Factory (HlaingTet) uses the
responsible person to maintain and check the quality of raw
materials and finished goods at warehousing and storage.
Moreover, they rent vehicles from long term relationship owners
who arrange drivers to deliver the products for right time, right
days, and right palaces according to transportation plan of factory.
By analyzing the employee perception on performance, it is found
that the respondents agree the performance of Dagon Foods
Processing and Canning Factory (HlaingTet).
Moreover, the correlation of the variables showed that the logistics
activities (order processing, inventory management, packaging and
transportation) and firm performance has the strong and positive
correlation. In this multiple regression analysis, order processing,
inventory management, packaging and transportation are
significant and positive effect on performance of Dagon Foods
Processing and Canning Factory (HlaingTet). These results show
that factory can create better performance as the result of order
processing, inventory management, packaging and transportation
of logistics activities. Therefore, these factors were taken into
consideration and essential for the improvement of firm
performance. The findings of this study are valuable for the
organization to consider the strengths and weakness of the logistics
activities in the real workplace. Based on the findings of the study,
the factory can achieve and meet its goal and objective by
implementing systematically logistics activities because these
logistics activities are essential for Dagon Foods Processing and
Canning Factory (HlaingTet). Therefore, the factory should
carefully manage to increase logistics activities and to increase
firm performance in long term. For further research, it is suggested
that this research is expanded to the whole Myanmar of factory's
logistics activities and firm performance. It can be used in other
organization such as manufacturing or service organization, private
or public, profit or non-profit organization. Further research should
conduct the logistics activities of other companies in Myanmar.
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SunText Rev Arts Social Sci 5(1): 169.
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