Effects of Logistics Capabilities on Performance in Manufacturing Firms

This study, based on a survey of 1000 manufacturing firms in central south, south and central China regions, examines the relationship among logistics capabilities, competitive advantage and firm performance. By exploratory and confirmatory factor analyses, the scale of manufacturing firm's logistics capabilities is obtained. The results show that logistics capabilities can be conceptualized as a three dimensional construct: process capability, flexibility capability and information integration capability. Furthermore, after testing research hypotheses by LISREL, we find that process, flexibility and information integration capabilities all have significant effects on competitive advantage, and that only process capability has significant effects on firm performance. The implications for our findings are also presented for the improvement of manufacturing firm's logistics capabilities.