Logistics Business Intelligence and Performance of Courier Firms in Nairobi County, Kenya

Abstract

The logistics function is a crucial cost driver for firms, particularly within the courier industry, where logistics expenses can account for up to 50% of sales revenue. This presents a significant challenge for Small and Medium Enterprises (SMEs) lacking the infrastructure to manage these costs. In Africa, the population of over 1.3 billion and a combined GDP of approximately $2.6 trillion contribute to substantial logistics costs, estimated at $3.5 trillion annually. Courier firms in Nairobi County, Kenya, face similar pressures, driving the need for improved logistical operations. Despite efforts to reduce costs, 67% of logistics cost-reduction initiatives fail due to poor execution, largely attributed to a lack of stakeholder involvement and supply chain visibility. This study, guided by the Resource-Based View (RBV) theory, aimed to examine the relationship between logistics business intelligence and the performance of courier firms in Nairobi County. Using a descriptive research design, data was collected from a sample of 72 courier firms, with findings indicating a weak but positive correlation between logistics business intelligence and courier firm performance. The study concluded that logistics business intelligence significantly influences performance, recommending investments in staff training, technological integration, flexible operational policies, and enhanced reverse logistics. Further research is suggested on logistics business intelligence in other sectors and the role of emerging technologies like artificial intelligence and blockchain in the logistics industry.