Determinants of online merchants’ satisfaction on third party logistics in a developing nation: a partial least square (PLS) approach

Abstract

Rapid digitalization and explosive growth of e-commerce have elevated the need for effective supply chain and logistics management in the online retail sector. Consequently, third-party logistics (3PL) providers are becoming indispensable to online retailers as a way to satisfy customers’ demands for prompt and dependable deliveries. The study is aimed at identifying major drivers ruling merchants’ satisfaction with third-party logistics from e-commerce perspectives. A set of multifaceted factors are investigated in this study that encourage retailers to employ third-party logistics rather than their own fleets. This study is quantitative in nature where 250 respondents are chosen on the basis of the random sampling method. In organizing and constructing factors, demographic statistics, and factor analysis are used respectively. In analyzing data and testing the hypothesis, the Partial Least Square Structural Equation Modeling (PLS-SEM) approach is applied using SMART PLS-4 software. The findings of this study can be a basis for third-party logistics providers to optimize their logistics services and design marketing and operational programs to enhance partnerships with their clients. Moreover, this research provides important insights into the continuous endeavor to increase the efficiency and effectiveness of the e-commerce sector in developing countries.

Keywords

• Third-party logistics
• e-commerce
• online merchants
• merchants’ satisfaction
• SEM
• reliability