Improving distribution and business performance through lean warehousing

Purpose: Recent literature recognizes the role of warehouses in enhancing the overall logistics performance. Thus, lean thinking has recently found its way in supporting warehouse and distribution centre operations. The purpose of this paper is to examine the relationships among warehouse waste reduction practices, warehouse operational performance, distribution performance and business performance. Design/methodology/approach: A two-stage study was conducted. First, a Delphi technique was adopted to develop a relevant questionnaire. Second, this questionnaire was used to measure the degree of waste reduction in the different warehouse activities and to test the developed research hypotheses. The authors test the hypotheses with a sample of Middle Eastern warehouse operators. Findings: There exists a positive relationship between warehouse waste reduction level and both warehouse operational performance and distribution performance. There was no direct relationship between warehouse waste reduction level and business performance. However, results revealed that the relationship between warehouse waste reduction level and business performance was mediated by warehouse operational performance and distribution performance. Practical implications: The developed instrument provides a guide for logistics managers as to understand how to reduce waste in each warehousing activity. The results also inform logistics managers of how distribution performance can be improved through lean warehousing. The resulting performance improvements in the distribution operations will ultimately be reflected in the logistics performance of downstream retailers. Originality/value: The study develops an original instrument for measuring waste reduction in warehouses, and provides insights into the evolving lean warehousing research area. This is the first scholarly work to uncover the relationships among warehouse waste reduction practices, warehouse operational performance, distribution performance and business performance.