Framework Development and Validation of Logistics Perfect Order Fulfillment in the Retail Industry

Abstract

The retail supply chains is becoming customer-centric which requires a robust Logistics Perfect Order (LPO) instrument to evaluate logistics last-mile delivery performance in the context of retail. The absence of a psychometrically validated measurement model creates a constraint in both the academe and industry. This study aimed to develop and validate a multidimensional measurement model of LPO. Using a quantitative cross-sectional design, data was gathered through simple random sampling among retail and logistics supervisors, managers, and business owners. Gathered from 461 respondents in the Exploratory Factor Analysis and 423 in the Confirmatory Factor Analysis, it was analyzed using PLS-SEM. Results showed a refined and empirically supported four-domain LPO capability architecture, consisting of Product Quality Assurance and Service Recovery (PQASR), Delivery Flexibility, Communication, and Customer Coordination (DFCCC), Customer Relationship Management and Packaging/Handling Controls (CRMPH), and Route Planning, Forecasting, and Operational Reliability (RPFor). The results indicated that delivery quality and recovery mechanisms comprise the most influential LPO dimension, while technology serves as an enabler integrated among various dimensions rather than act independently. The final framework provides a valid and reliable model to assess the performance of the retail last-mile delivery and is recommended for application and more validations across diverse retail logistics settings.