An evaluation of retail companies’ logistics performance - A case study with ICA Non Food

Examensarbete för masterexamen

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Type: Examensarbete för masterexamen
Master Thesis
Title: An evaluation of retail companies’ logistics performance - A case study with ICA Non Food
Authors: Olsson, Linnea
Shulemaja, Gentiana
Abstract: Consumers are getting more demanding and more price-conscious nowadays and this force the retailers to have a more responsive supply chain at the same time as keeping the costs as low as possible. Therefore, the logistics performance is getting increasingly important for a retail company that wants to be successful by responding to the consumers’ demands. Measuring the logistics performance internally within the company is commonly used but it could also be beneficial to do an external comparison such as a benchmarking. By performing a benchmarking it is possible to borrow ideas from other companies and adapt them to gain competitive advantage. One retail company that works with the improvement of their logistics performance is ICA Non Food. ICA Non Food has continuously improved their logistics performance during the last years and strives to increase their performance and competitiveness even further. To succeed with this, ICA Non Food is thrived to discover potential areas of improvement by increasing their understanding of how good their logistics performance is compared to other retail companies. Therefore, the aim of the study is to increase ICA Non Food’s understanding of their current logistics performance and by this making them aware of potential areas of improvement. This was done in two steps. The first step was to understand how ICA Non Food currently is measuring and following up their logistics performance compared to the literature in order to investigate if the company is covering the critical and most relevant KPIs and aspects when managing their logistics performance. The other step was to perform a benchmarking involving six leading retail companies, including ICA Non Food, to understand how the logistics performance currently look like at ICA Non Food compared to the other benchmarked companies. Findings indicated that ICA Non Food does all in all manage their logistics performance in a good way and as the literature recommends. However, the company has some potential areas of improvement such as increasing the employees’ involvement in their logistics performance by making the logistics KPIs more accessible for them. The most important findings from the benchmarking process was that ICA Non Food is managing their inventories good since they has a competitive inventory turnover value compared to the other benchmarked companies. On the other hand, the company’s total logistics costs as a percentage of sales is higher than the majority of the benchmarked companies and this KPI is therefore not as competitive as the inventory turnover. From the findings it can be concluded that ICA Non Food’s higher value on total logistics costs as percentage of sales compared to the majority of the other benchmarked companies, is not due to their inventory management since they performed well with their KPI inventory turnover. Instead the value could be high due to other factors such as high outbound transportation costs that they should try to reduce.
Keywords: Transport;Övrig industriell teknik och ekonomi;Transport;Other industrial engineering and economics
Issue Date: 2015
Publisher: Chalmers tekniska högskola / Institutionen för teknikens ekonomi och organisation
Chalmers University of Technology / Department of Technology Management and Economics
Series/Report no.: Master thesis. E - Department of Technology Management and Economics, Chalmers University of Technology, Göteborg, Sweden : E2015:072
Collection:Examensarbeten för masterexamen // Master Theses

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