Abstract
This study examined the potential of Logistics 4.0 for mitigating the risks posed by pandemics on the key performance indicators of the third-party logistics (3PL) industry in the South African retail sector. The study focused on the impact of the Covid-19 pandemic on the 3PL industry, specifically regarding delivery time and inventory accuracy.
Today’s business world is becoming increasingly complex and unpredictable for global companies. The changing conditions caused by the worldwide spread of the Covid-19 virus pandemic have increased competition for certain products. The COVID-19 pandemic has significantly impacted the South African retail industry, with lockdown measures and travel restrictions causing disruptions in the movement of goods and supply chain operations. These disruptions have ripple effects throughout the industry, affecting retailers and 3PL providers. One of the significant challenges facing 3PL providers in South Africa is the disruption of global supply chains. The closure of ports and border restrictions have led to delays in delivery times, inventory shortages, and increased transportation costs. This has also led to difficulties in maintaining optimal inventory levels, with some retailers experiencing stockouts and reduced order accuracy. The accelerated development of science and technology and the globalisation of the market means that most organisations face a race to find solutions that meet their customers’ needs, optimise their processes and improve their competitiveness. Companies can turn to technical and organisational solutions to increase company adaptability, meet consumer needs swiftly and effectively, and be competitive. By analysing the use of Logistics 4.0 technologies such as automation, the Internet of things (IoT), and big data analytics in the 3PL industry, this research evaluated their potential to improve performance and mitigate pandemic-related risks.
A quantitative research approach was adopted for the study. The data was collected through a structured questionnaire completed by managers, directors, heads of departments, warehouse managers, and the courier/delivery personnel of selected 3PL companies in Gauteng Province, South Africa. Overall, 171 questionnaires were sent out to the target respondents. Of these, 160 were returned and used for the analysis, representing a 94% response rate. The data were analysed using Statistical Package for Social Science software, enabling easy data presentation using
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descriptive statistics such as mean item score, standard deviation, and exploratory factor analysis.
The study findings revealed that industry professionals are sceptical when it comes to the use of technologies that they are unfamiliar with. It was also discovered that adopting IoT technologies is considered the most viable measure for mitigating the effects of the pandemic on the industry. Conclusions drawn from the literature, industry best practices, and study findings were used for developing practical recommendations for resolving the problem, with an important recommendation being the improvement of big data analytics’ competence to improve operational decision-making competency.
Key words: Logistics, Logistics 4.0, Pandemic risks, Key performance indicators, Third-party logistics.