Business Research Methods

RMB301

Lecturer: Nguyễn Phi Hùng

Class: IB1707

Factors impacting Warehouse system in Sustainable Supply Chains: From Vietnam

Logictics Firm perspectives

Group 5

Trần Huyền Anh – HS171563

Trịnh Thị Hậu - HS173320

Nguyễn Minh Ngọc - HS173186

Nguyễn Minh Hiếu - HS170791

Phạm Ngọc Nam - HE170967

 Chapter 2: Literature Review

2.1. Literature review on topic

2.1. Literature review topic (Ngọc)

2.1.1 Warehouse Management in logistics

Logistics warehousing has evolved into a crucial element within the operational framework
of contemporary businesses and the broader economy, playing a transformative role
beyond its traditional function as a mere storage facility. For manufacturing enterprises,
warehouses are integral to storing raw materials and semi-finished goods, while trading
companies utilize them to manage inventories of finished products ready for market
distribution. The evolution of warehouses from basic storage areas into multifunctional
logistics centers offering services such as cross-docking, assembly, consolidation,
classification, and labeling has significantly enhanced business process optimization.
These modern logistics practices help reduce transportation and warehousing costs,
accelerate delivery timelines, and provide businesses with a competitive edge by improving
overall supply chain efficiency (Tiupysheva et al., 2023).

Over the course of the 20th century, advancements in management practices gave rise to
innovative strategies that transformed warehouse management. A notable method is the
Just-In-Time (JIT) inventory management strategy, which was initially developed by the
Toyota Motor Company in Japan. This approach promotes continuous-flow production
aimed at precisely balancing supply and demand. JIT has gained widespread application
across diverse industries, including manufacturing, commerce, and healthcare, due to its
ability to minimize inventory levels, reduce waste, and enhance operational agility
(Sugimori et al., 1977). The shift towards JIT and other modern management strategies
reflects the increasing recognition of warehouses as pivotal elements within the supply
chain, tasked with maintaining stability and optimizing the movement of goods.
Effective warehouse management not only aids in balancing supply and demand but also
minimizes storage costs, accelerates product turnover, and enhances the ability to meet
customer needs promptly. According to Shah and Khanzode (2017), the primary objective
of warehouse operations is to ensure customer satisfaction through efficient resource
utilization, guaranteeing that the right products are delivered to the correct locations, at the
right time, and in optimal condition (Buzu, 2021). Core warehouse activities include
receiving, picking, storage, and shipping, complemented by secondary functions such as
sorting, packing, routing, and assembly, all of which contribute to enhancing operational
efficiency and streamlining logistics processes.

Key Warehouse Management Strategies:

The JIT strategy focuses on delivering goods and materials to the warehouse only when
they are needed for production or to fulfill customer orders, thereby maintaining inventory
levels at a minimum. By avoiding overstocking, JIT reduces storage costs and maximizes
production efficiency. Heizer and Render (2014) argue that JIT's emphasis on waste
reduction and quality improvement makes it a highly effective inventory management
method. Nonetheless, the strategy is heavily dependent on the stability and reliability of
the supply chain, as any disruptions, such as shipping delays or material shortages, can
significantly hinder a business's ability to meet demand. To effectively implement JIT,
companies must maintain a robust and reliable supply chain network, ensuring a consistent
flow of materials (Mankazana & Mukwakungu, n.d.).

Cross-docking is a warehouse management technique that facilitates the direct transfer of

goods from the receiving area to the shipping area, eliminating the need for prolonged
storage. This method minimizes storage costs and expedites delivery by reducing the dwell
time of products in the warehouse. For cross-docking to be successful, effective
coordination among stakeholders and an optimized warehouse management system that
supports the seamless flow of goods are essential (Sadykov, 2012). The efficiency gained
through cross-docking can significantly enhance the responsiveness of supply chains,
particularly in sectors where speed and flexibility are critical.

A Warehouse Management System (WMS) is an automated software solution that supports

warehouse operations, including inventory tracking, order picking, transportation
management, and overall warehouse administration. Modern WMS solutions enhance the
accuracy of inventory control, increase operational efficiency, and reduce errors.
Integration with Enterprise Resource Planning (ERP) systems allows WMS to optimize the
entire supply chain by providing a comprehensive approach to logistics management
(Amanda Istiqomah et al., 2020). The adoption of WMS has become indispensable for
businesses seeking to adapt to the complexities of global supply chains and meet the
growing demand for rapid and accurate order fulfillment.

The transition from traditional warehousing methods to contemporary strategies such as

JIT, cross-docking, and the adoption of WMS reflects a significant shift in warehouse
management philosophy. This evolution has not only improved business operational
efficiency and reduced costs but has also prompted substantial changes in the management
of supply chains. Companies are increasingly leveraging advanced warehouse management
techniques to remain competitive in a rapidly changing global economic environment.
Applying these modern strategies is essential for businesses to enhance their competitive
position, increase supply chain flexibility, and respond effectively to ongoing market
dynamics.

2.1.2 Sustainable Supply chain Management

Sustainable supply chain management (SSCM) is becoming increasingly important in the

current context as businesses face pressure from many sides to carry out environmentally
friendly and responsible business practices responsibility to society. SSCM not only
focuses on economic efficiency but also includes environmental and social factors, to
ensure that production and logistics activities do not harm natural resources and
communities (Hong et al., 2018). A chain Sustainable supply includes many different
elements and approaches, of which key elements include:

Closed-Loop Supply Chain: This is a supply chain model that integrates both recycling
and waste treatment processes, in which products after use are recovered, recycled or
reused to create new products. Closed-loop supply chains help reduce waste and use
resources more efficiently by recycling and reusing input materials. It not only minimizes
negative impacts on the environment but also helps businesses save costs through
recycling of materials(Ullah, 2023).

Product Lifecycle Model: Product lifecycle management (PLM) includes stages from
development, production, distribution, use, to post-use disposal. This model helps
businesses evaluate the environmental impact at each stage of the product, thereby
optimizing the production and distribution process to minimize negative impacts on the
environment. By applying PLM, businesses can improve sustainability through measures
such as designing products that are easy to recycle, minimizing raw materials used, and
optimizing production processes.

Integrated Sustainable Supply Chain: This is a supply chain model that combines
sustainable elements into each stage of the supply chain, from input materials,
production, distribution, to consumption. This model requires businesses to continuously
evaluate and improve their operations to ensure that sustainability factors are fully and
effectively integrated(Koberg & Longoni, 2019).

The sustainability of the supply chain depends on many factors, of which important
factors include:

Product quality: Products with high quality and durability often have longer life cycles,
which reduces waste and reduces the need for frequent product replacement. Improving
product quality not only meets customer needs but also contributes to minimizing
negative impacts on the environment. Products with sustainable qualities are also often
designed to be easily recycled or reused(Mappesona et al., 2020).

Market demand: Changes in consumer demand and market trends can strongly influence
supply chain sustainability. Today, consumers increasingly favor environmentally
friendly products and services, which pushes businesses to adjust their operations to meet
these requirements. Businesses also need to be flexible in meeting market demand in a
sustainable way, such as providing products from renewable sources or with
environmental certification(Aamer et al., 2021).

Pressure from stakeholders: Stakeholders including customers, investors, communities,

and governments, can all create pressure on businesses to implement sustainable
practices. . This pressure may come from government environmental regulations(Siems et
al., 2023)

market, customer requirements for sustainable products, or society's expectations about

corporate social responsibility. Meeting these requirements not only helps businesses
improve their brand image but also opens up new market opportunities.

Sustainable supply chain management requires the integration of environmental and

social factors into each stage of the supply chain. Models such as closed-loop supply
chains and product life cycles have contributed to promoting sustainability through
process optimization and minimizing negative environmental impacts. Supply chain
sustainability is influenced by product quality, market demand, and pressure from
stakeholders. To maintain a competitive advantage, businesses need to constantly
improve and adjust their strategies to meet increasing requirements for sustainability.

2.1.3 Intergration of Sustainability in Warehouse Management

Sustainable warehouse management is an important part of the modern supply chain,
especially in the context of increasing awareness of climate change and increasingly
stringent environmental requirements. Sustainable elements are integrated into warehouse
management systems with the goal of minimizing negative impacts on the environment,
while optimizing operational performance.

• Green Technology and Carbon Reduction Measures

One of the popular measures in sustainable warehouse management is the use of green
technology, including energy-saving LED lighting systems, solar power and automation
devices to reduce energy consumption. Modern warehouses can use solar batteries to
power lighting systems and operate equipment, thereby reducing CO2 emissions.
Additionally, advanced energy management devices can monitor and optimize warehouse
energy consumption(Chaitanya Korra ; Akshita Sadhana V., 2024).

• Reuse and Recycle Materials

Reusing and recycling are measures that help reduce the amount of waste generated from
warehouse operations. For example, businesses can reuse pallets, cartons, and other
packaging materials to reduce costs and environmental impact. In addition, warehouses
can also apply internal recycling processes, for example treating and recycling
wastewater from warehouse cleaning(Zhang et al., 2023).

• Sustainability Standards and Certification

Standards and certifications such as LEED (Leadership in Energy and Environmental
Design) and ISO 14001 play an important role in motivating businesses to adopt
sustainable warehouse management practices. LEED is an international standard for the
design and construction of green buildings, including warehouses, that help improve
environmental performance and human health. ISO 14001 is an environmental
management system standard that encourages organizations to take measures to minimize
their impact on the environment through effective management of resources(de Jesus
Pacheco et al., 2023).

2.1.4 Key factors Impacting Warehouse management systems

The effectiveness of a warehouse management system depends on many factors,

including technology, costs, policies and personnel development.

• Technology And Automation

Technology and automation play an essential role in optimizing warehouse management.

The Internet of Things (IoT) enables real-time tracking of goods, thereby improving the
ability to manage and coordinate warehouse activities. Automated inventory management
systems and WMS software help automate inventory, picking, and warehouse
management processes, helping to reduce errors and increase efficiency(Hamdy et al.,
2022; Jarašūnienė et al., 2023).

• Operating Costs and Resources

Maintaining a sustainable warehouse management system can require high initial

investment costs, such as costs for energy-saving technologies and automation systems.
However, these measures provide long-term benefits, including reduced energy costs and
resource optimization. Businesses need to carefully consider costs and benefits when
implementing sustainable warehouse management systems(Tong et al., 2023).

• Policies and Regulations

Increasingly strict environmental policies and regulations have created great pressure on
businesses to comply with sustainability standards. Government regulations on emissions
reduction and waste disposal force businesses to implement innovative measures to
ensure compliance and avoid financial penalties(Le, 2020).

• Human Resources Training and Development

The skills and sustainability awareness of personnel have a great influence on the
effectiveness of the warehouse management system. To ensure that sustainability
measures are implemented effectively, businesses need to invest in employee training
programs on energy management, waste disposal, and other sustainable processes. This
helps raise employee awareness and create a sustainable culture within the
business(Tikwayo & Mathaba, 2023).

2.1.5 Vietnam’s Logistics Industry Overview

The logistics industry in Vietnam is on a strong development path, with high demand for
storage and warehouse management. According to Vietnam Logistics Report, this
industry plays an important role in the economy, accounting for about 4-5% of GDP and
is expected to continue to grow in the coming years. However, this rapid development
also poses major challenges in terms of infrastructure and warehouse management
efficiency.

• Challenges in Adopting Sustainable Warehouse Management Systems

Despite significant progress, implementing sustainable warehouse management systems

in Vietnam still faces many difficulties. Businesses still lack experience and technology
to implement sustainable measures. Current infrastructure, including many old
warehouses, does not meet the requirements for energy saving and waste management
according to international standards(Pham Van et al., 2023).

• Opportunities for Pioneering Businesses

Besides challenges, Vietnam's logistics industry also has many opportunities for
transformation. The government has issued many policies to encourage businesses to
invest in green technology and sustainable measures, such as tax incentives and grants for
investment projects in green infrastructure. This is an opportunity for pioneering
businesses to create competitive advantages and enhance their position in the
international market(Khoa & Nhung, 2020; Anh Duc Do, 2024).

Integrating sustainable elements in warehouse management and sustainable logistics

development in Vietnam is an inevitable trend, although it still faces many challenges.
Businesses need to invest in technology, staff training and comply with environmental
regulations to take advantage of opportunities in a rapidly changing market context.
2.2. Literature review on related models

2.2.1. The Effect of Management Information System (MIS) on Warehouse

Operation (Saifudin et al., 2012)
The theoretical research framework presented in the article focuses on the interplay
between Management Information Systems (MIS), warehouse operations, and warehouse
efficiency within Small and Medium Enterprises (SMEs). This framework is essential for
understanding the dynamics of these variables and their impact on operational
performance.

Key Variables: The framework identifies three primary variables:

Warehouse Operations (WO): This variable encompasses the processes involved

in managing the flow of goods within the warehouse, including receiving, storing, and
distributing products.

Warehouse Efficiency (WE): This variable measures how effectively the

warehouse operations are conducted, focusing on aspects such as inventory accuracy and
space optimization.

Warehouse Management Information Systems (WMIS): This variable represents

the technological systems that support warehouse operations, providing critical data and
facilitating decision-making processes.

Hypotheses: The framework is built upon several hypotheses that guide the research:

Hypothesis 1: There is a significant relationship between Warehouse Operations

(WO) and Warehouse Efficiency (WE). This hypothesis posits that improvements in
warehouse operations will lead to enhanced efficiency in the warehouse.

Hypothesis 2: Warehouse Management Information Systems (WMIS) mediate the

relationship between Warehouse Operations (WO) and Warehouse Efficiency (WE). This
suggests that the effectiveness of warehouse operations is influenced by the quality and
implementation of MIS, which in turn affects overall efficiency.

Hypothesis 3: There is a positive relationship between Warehouse Operations

(WO) and Warehouse Management Information Systems (WMIS). This hypothesis
indicates that better warehouse operations are associated with more effective use of MIS.

Research Methodology: The framework is supported by a quantitative research

methodology, where data is collected through questionnaires distributed to SMEs in the
manufacturing sector. The study achieved a response rate of 18.9%, with 182 usable
responses, which is deemed acceptable for social science research.

Statistical Analysis: The relationships posited in the framework are tested using multiple
linear regression analysis, with the Sobel Test employed to assess the mediating effect of
WMIS on the relationship between WO and WE. This rigorous statistical approach
ensures the validity of the hypotheses and the overall framework.

2.2.2. Role of Warehouse Attributes in Supply Chain Warehouse Efficiency in

Indonesia (Jermsittiparsert et al., 2019)

The theoretical framework of the study on warehouse attributes and supply chain
warehouse efficiency identifies key factors, variables, and hypotheses that guide the
research. This literature review synthesizes the relevant components based on the
provided contexts.

Variables:
 Independent Variables: The independent variables in this study are the warehouse
attributes, specifically:

Layout: Refers to the physical arrangement of resources within the warehouse,

which affects the flow of materials and information.

Operations: Encompasses the processes and activities carried out within the
warehouse, including inventory management and order fulfillment.

Dependent Variable: The dependent variable is supply chain warehouse efficiency,

which measures how effectively a warehouse operates in fulfilling customer needs and
managing resources.

Mediating Variable: Management Information Systems (MIS) serve as a

mediating variable in this framework. MIS is posited to enhance the relationship between
warehouse attributes and supply chain efficiency by improving communication, data
management, and operational processes.

Hypothesis: The study proposes several hypotheses based on the relationships identified
in the theoretical framework:

H1: There is a positive relationship between warehouse layout and supply chain
warehouse efficiency.

H2: There is a positive relationship between warehouse operations and supply

chain warehouse efficiency.

H3: There is a positive relationship between MIS and supply chain warehouse
efficiency.

H4: MIS mediates the relationship between warehouse layout and supply chain
warehouse efficiency.
 H5: MIS mediates the relationship between warehouse operations and supply
chain warehouse efficiency.

2.2.3. Identifying sustainable warehouse management system indicators and

proposing new weighting method (Torabizadeh et al., 2020)

The conceptual model presented in the paper focuses on identifying and evaluating key
performance indicators (KPIs) for sustainable warehouse management systems (WMS)
through a structured approach. Here are the key components of the model:

Variables: The model incorporates three primary unobservable variables representing the
dimensions of sustainability:

Economic Sustainability: This variable assesses the financial performance and

cost-effectiveness of warehouse operations.

Environmental Sustainability: This variable evaluates the ecological impact of

warehouse activities, including waste management and energy consumption.

Social Sustainability: This variable focuses on the social implications of

warehouse operations, such as labor practices and community engagement.

Hypotheses: The relationships between the constructs are guided by theoretical

foundations that dictate the expected direction of influence. The model posits that the
three sustainability dimensions (economic, environmental, and social) positively
influence the overall sustainability performance of the warehouse management system.
This is supported by the formative direction used to link these unobservable variables to
the sustainable warehouse (SW) construct.
Validity and Reliability: The model's validity is assessed through various tests, including
discriminant validity and convergent validity. The Average Variance Extracted (AVE)
for all constructs exceeds the threshold of 0.5, confirming the model's robustness.
Additionally, the use of exploratory factor analysis (EFA) and Cronbach's alpha ensures
that the constructs maintain internal consistency and construct validity.

Methodology: The study employs structural equation modeling (SEM) to weight the
indicators and evaluate their total effects on sustainability performance. A comprehensive
literature review and expert surveys were conducted to identify 33 key performance
indicators relevant to sustainable warehouse management.

2.2.4. Impact of Warehouse Management Factors on Performance Improvement of

3rd Party Logistics Industry (Kodithuwakku et al., 2022)

The developed conceptual model in the study focuses on identifying key factors that
influence warehouse performance within the third-party logistics (3PL) industry in Sri
Lanka. The literature review highlights several critical components:

Key Factors Identified:

The study identifies twelve critical key factors that impact warehouse performance,
categorized into three main groups:

Operational Factors: These include aspects related to the efficiency of warehouse

operations, such as labor productivity and material handling processes.

Economy Factors: These factors pertain to cost-effectiveness and financial

management within the warehouse context.
 Environmental Factors: These factors consider the sustainability and
environmental impact of warehouse operations.

Dependent Variables:

The model uses three main dependent variables to evaluate warehouse performance:

Labour Productivity: This measures the efficiency and output of the workforce
within the warehouse.

Space Utilization: This assesses how effectively the warehouse space is used,
which is crucial for maximizing storage and operational efficiency.

Customer Satisfaction: This reflects the level of service provided to customers and
their overall satisfaction with the logistics services.

Hypotheses Developed:

Based on the identified factors and their relationships with the dependent variables,
several hypotheses were formulated:

H1: Operational, economical, and environmental factors impact labour

productivity performance.

H2: Operational, economical, and environmental factors impact on warehouse

space utilization.

H3: Operational, economical, and environmental factors impact on customer

satisfaction.

H4: Operational, economical, and environmental factors impact on overall

warehouse performance.

Methodological Approach:
The study employs a systematic literature review and expert opinions to refine and filter
the identified factors, ensuring that they are relevant and significant to the 3PL industry.
This methodological rigor enhances the validity of the conceptual model.

2.3. Theoretical foundation

2.3.1. Warehouse Management

• [Link]. Definition of Warehouse Management

Warehouse management is a crucial component of the supply chain, encompassing

activities related to the storage, handling, and distribution of goods. Warehouse
management is not merely about storing products but also involves managing the flow of
goods, information, and value-added activities within the warehouse (Martin Christopher,
2016). It includes functions such as receiving, inspecting, storing, inventory management,
preservation, and order preparation for delivery. These activities ensure that goods are
always available and promptly meet market demands while optimizing costs and enhancing
the operational efficiency of the enterprise.

Warehouse management comprises several fundamental activities that collectively ensure

the efficient functioning of operations. The first key activity is storage, which involves the
systematic arrangement and preservation of goods to enable easy access and effective
management. Achieving efficient storage requires categorizing items based on attributes
such as weight, size, and usage frequency (Frazelle, 2002). This categorization is essential
for optimizing space utilization and minimizing retrieval time, ultimately enhancing the
overall efficiency of the warehouse.

The second core activity is handling, which includes all tasks associated with the
movement of goods within the warehouse. These tasks encompass receiving, picking,
packing, and preparing items for shipment. Proper handling is critical to reducing errors
and preventing losses during the transportation process. Improving handling processes can
significantly reduce processing time and increase labor productivity (Bartholdi & Hackman,
2014). As such, handling optimization is a key factor in maintaining a smooth operational
flow and ensuring the effective use of resources.
The third major activity involved in warehouse management is distribution, which refers
to the shipping and transportation of goods to customers. An efficient warehouse
management system plays a crucial role in optimizing distribution routes, thereby reducing
transportation costs and improving delivery times. The accuracy and timeliness of
distribution are essential determinants of customer satisfaction and vital components of
supply chain efficiency (Lambert, 2001). Therefore, continual efforts to refine distribution
processes are necessary to maintain a competitive advantage and deliver high-quality
service.

In the supply chain, warehouse management serves as a critical link connecting suppliers,
manufacturers, and consumers. It not only ensures the availability of goods but also
contributes to maintaining appropriate inventory levels, thus avoiding surplus or shortages.
Effective warehouse management can reduce supply chain operating costs through
inventory minimization, process optimization, and service quality improvement (Gu et al.,
2006).

Furthermore, warehouse management affects the ability to respond to market fluctuations.

In a competitive market, the ability to quickly and flexibly adapt warehouse management
practices can create significant competitive advantages. This is particularly important in
industries with frequently changing or seasonal demand, such as fashion, consumer
electronics, and food products. Flexible warehouse management, capable of rapid
adjustments, can help businesses enhance responsiveness to changes in customer demand
and mitigate risks associated with inventory holding (Krajewski et al., 2013).

Warehouse management influences not only costs but also the overall effectiveness of the
supply chain. An efficient warehouse management system accelerates order processing,
reduces errors in operations, and improves the accuracy of inventory information. Modern
technology such as Warehouse Management Systems (WMS) offers automation solutions
that enable real-time inventory tracking, thereby enhancing efficiency and accuracy in
management (Richards & Gwynne, 2017).
Warehouse management plays a significant role in improving customer service. A well-
managed warehouse increases the rate of on-time order fulfillment and minimizes customer
wait times. The ability to provide better service not only boosts customer satisfaction but
also creates opportunities to build loyalty and establish sustainable competitive advantages
(Tompkins, 1998).

• [Link]. Key Functions of Warehouse Management

• [Link].1. Inventory Management

Inventory management is a fundamental function in warehouse management, involving the

monitoring, controlling, and managing of inventory levels to ensure goods are always
available to meet customer demand without creating excess stock. Effective inventory
management can help reduce inventory costs and improve the ability to quickly respond to
changing market demand. Efficient inventory management not only ensures appropriate
stock levels but also improves cash flow and reduces the risk of obsolete products.

Common inventory management techniques include ABC classification (categorizing

goods based on value and usage frequency) and Just-In-Time (JIT), a strategy that
minimizes inventory by synchronizing supply and production processes to meet demand
promptly. These techniques help lower average inventory levels and minimize storage
costs (Dange et al., 2016).

• [Link].2. Storage Space Optimization

Storage space optimization is a critical function in warehouse management aimed at

maximizing space utilization and reducing costs. A well-organized warehouse layout, with
goods classified and arranged based on usage frequency or size, can reduce search and
retrieval times. Bartholdi and Hackman (2014) emphasize that optimizing storage space
can significantly increase warehouse productivity and reduce order processing time.
Several methods for storage optimization include the use of multi-tier shelving, Automated
Storage and Retrieval Systems (AS/RS), and high-density storage techniques. These
methods not only help save space but also improve warehouse circulation and reduce safety
risks.

• [Link].3. Optimization Order Processing

Order processing encompasses activities from receiving the order request to preparing
goods for delivery to the customer. This process requires high accuracy and speed to meet
customer expectations. According to Tompkins and Smith (1998), an efficient order
processing system can reduce order preparation time and improve the rate of on-time order
fulfillment.

Modern technologies such as Warehouse Management Systems (WMS) and Order

Management Systems (OMS) have automated processing workflows, minimized errors,
and increased operational efficiency. Richards (2017) points out that the adoption of these
technologies can improve order information accuracy and reduce labor costs.

• [Link].4. Transportation and Shipping

Transportation and shipping represent the final function in warehouse management,

involving the delivery of products from the warehouse to the customer. This is one of the
most critical steps in ensuring that goods are delivered to the right place, at the right time,
and at a reasonable cost. Lambert and Stock (2001) argue that optimizing transportation
can help reduce logistics costs, improve delivery times, and enhance the quality of
customer service.
Technologies such as GPS tracking, route optimization, and the use of eco-friendly
transport vehicles have contributed to improving the efficiency of goods transportation.
These advancements not only help reduce costs but also support building a sustainable
supply chain by lowering carbon emissions and protecting the environment.

• [Link]. Warehouse Performance Measurement Models

The SCOR model serves as an internationally recognized framework designed to evaluate

and optimize various supply chain activities, including planning, sourcing, production,
distribution, and returns management. This model employs key performance indicators
(KPIs) to provide comprehensive insights into the efficiency of warehouse operations and
the overall supply chain. Through these metrics, organizations can identify areas for
improvement and implement strategies to enhance performance.

One crucial KPI is the order fulfillment cycle time, which measures the duration from
receiving an order to completing the delivery. Optimizing this metric is essential for
enhancing responsiveness and reducing inventory costs, thereby improving the quality of
customer service. A shorter cycle time reflects a more agile and adaptable supply chain
that can promptly meet customer demands. Consequently, reducing order fulfillment cycle
time is a vital aspect of maintaining a competitive advantage in the marketplace.

Another significant metric is the supply chain cost, which encompasses the expenses
related to warehouse management, transportation, and order processing. Reducing these
costs through optimized warehouse operations can substantially improve a company's
overall efficiency (Lapinskaitė & Kuckailytė, 2014). Lower supply chain costs not only
contribute to increased profitability but also enhance the company’s competitive
positioning. Thus, careful monitoring and management of supply chain costs are
fundamental to achieving sustainable growth.

The perfect order rate is a KPI that evaluates the percentage of orders processed without
errors and delivered on time. This metric is critical for ensuring customer satisfaction and
enhancing operational performance. A high perfect order rate indicates that the supply
chain is effectively meeting customer expectations while minimizing disruptions. As such,
efforts to improve this rate can lead to better service quality, higher customer retention,
and stronger operational reliability.

Lean warehousing metrics are grounded in lean principles that focus on optimizing
processes and eliminating waste within warehouse operations. These metrics are designed
to reduce costs, increase productivity, and support sustainability objectives. By
systematically assessing various aspects of warehouse management, organizations can
enhance overall efficiency and align their practices with lean methodologies.

One key metric is the space utilization rate, which evaluates the efficient use of warehouse
space, including both floor area and storage height. This metric helps identify areas that
can be optimized to maximize space utilization. Higher space utilization rates indicate a
more effective use of available storage, leading to lower storage costs and improved
operational flow. Therefore, efforts to increase space efficiency are critical for reducing
overhead costs and ensuring the warehouse operates at its full potential.

Another important metric is order processing time, which measures the duration from
receiving an order to having the goods ready for shipment. Reducing this time is essential
for accelerating responsiveness and optimizing the flow of goods through the warehouse.
Streamlining the order processing steps not only improves throughput but also enhances
customer service levels by enabling faster delivery times. Thus, a shorter order processing
time is indicative of a more agile warehouse capable of meeting customer demands more
effectively.

The rework rate is also a crucial metric, as it evaluates the frequency of tasks that need to
be redone due to errors in the handling process. Lowering the rework rate is vital for
reducing operational costs and improving service quality. It serves as a critical indicator of
process quality and operational efficiency, with a low rework rate signifying fewer errors
and minimal disruptions in the workflow. Consequently, minimizing rework is an
important objective for maintaining a high standard of warehouse operations.
Both the SCOR Model and Lean Warehousing Metrics provide valuable frameworks for
assessing and improving warehouse management practices. While the SCOR Model
focuses on end-to-end supply chain performance, Lean Metrics emphasize continuous
improvement within warehouse processes. Integrating these approaches can help
organizations achieve higher efficiency, better customer satisfaction, and sustainable
growth.

2.3.2. Sustainable Supply Chain Management (SSCM)

• [Link]. Definition of Sustainable Supply Chain Management

Sustainable supply chain management (SSCM) is a concept in supply chain management

aimed at achieving a balance between economic, social, and environmental factors in the
process of managing and optimizing the flow of products, information, and finances.
SSCM does not only focus on profit and economic efficiency but also considers the long-
term impacts on the environment and society. SSCM involves the integration of sustainable
development goals into logistics and supply chain activities, from sourcing raw materials,
production, storage, and distribution to recycling and waste management (Zimon et al.,
2020).

The Triple Bottom Line (TBL) theory, introduced by John Elkington in 1994, serves as a
significant framework in the field of sustainable development. It advocates that businesses
should expand their focus beyond traditional financial performance to include
environmental and social considerations when making decisions and evaluating success.
These three dimensions—economic, social, and environmental-form the "bottom lines" of
the TBL approach, with the primary objective being to achieve a balanced integration of
these factors to generate sustainable value for both businesses and society.

The economic dimension, or profit, pertains to ensuring that business operations are
financially viable, generating profit while optimizing the use of resources and managing
costs. In the context of a sustainable supply chain, this involves implementing strategies
that reduce logistics and production expenses without compromising environmental or
social sustainability. Achieving economic sustainability entails finding innovative
solutions to balance financial efficiency with broader sustainability objectives.
The social aspect, referred to as people, focuses on the impact of business activities on
communities and stakeholders. A sustainable approach requires that supply chain practices
ensure safe and fair working conditions for employees, while also promoting the well-being
and development of local communities where the business operates. The social dimension
emphasizes corporate responsibility in addressing human rights, labor standards, and social
equity throughout the supply chain, thereby contributing to the overall social fabric and
community resilience.

The environmental component, known as planet, emphasizes minimizing the negative

impacts of business activities on the natural environment. This includes efforts to reduce
greenhouse gas emissions, conserve energy, and protect natural resources. Sustainable
supply chain management (SSCM) seeks to incorporate green practices such as utilizing
recycled materials, optimizing transportation processes to lower emissions, and
minimizing waste generation. The environmental dimension of TBL highlights the
importance of responsible resource management and the need for businesses to actively
contribute to environmental conservation.

TBL plays a crucial role in sustainable development as it helps businesses identify specific
goals and priorities to balance economic profit, social welfare, and environmental
protection. TBL provides a framework for measuring and managing the performance of
economic, social, and environmental factors within the same system (Zaharia & Zaharia,
n.d.). This approach encourages businesses not only to focus on financial benefits but also
to consider social responsibility and environmental protection, thereby building a more
sustainable supply chain.

Recent studies have shown that applying TBL in supply chain management can bring
numerous benefits, including strengthening customer trust, enhancing brand reputation,
and reducing risks associated with environmental and social issues (Hacking & Guthrie,
2008). Moreover, adherence to TBL principles helps businesses better comply with
increasingly stringent global environmental and social regulations.
 • [Link]. Green Supply Chain Management (GSCM) Practices

Green supply chain management (GSCM) is the integration of environmental management

activities into supply chain management, aimed at minimizing negative environmental
impacts. GSCM practices typically include emission reduction, waste management,
recycling, and the use of renewable energy. The goal of GSCM is to promote sustainability
in the supply chain by reducing emissions, conserving resources, and optimizing logistics
operations.

A key component of GSCM is emission reduction, which seeks to minimize greenhouse

gas emissions associated with logistics and production activities (Amemba et al., 2013).
Strategies for achieving emission reductions include optimizing transportation routes,
using eco-friendly vehicles, and reducing vehicle speed. These measures contribute to
lowering CO2 emissions and enhancing the environmental performance of supply chain
operations. Waste management is another crucial practice within GSCM, involving the
control of waste generated during production and transportation processes. Effective waste
management measures may include the use of recycled packaging materials, minimizing
waste generation, and adopting cleaner production techniques. Such practices not only
reduce the negative environmental impacts associated with waste disposal but also
contribute to resource conservation and cost savings.

Recycling plays a significant role in GSCM by promoting the reuse of materials and
products at the end of their life cycle, thus reducing the need for new raw materials.
Integrating recycling processes into the supply chain helps protect the environment while
also reducing material costs (Handfield et al., 2005). The implementation of recycling
practices supports the circular economy, wherein materials are continuously repurposed to
extend their usefulness. The use of renewable energy sources, such as solar, wind, and
biomass, in logistics and production is a vital aspect of GSCM aimed at reducing
dependence on fossil fuels. The adoption of renewable energy helps lower greenhouse gas
emissions and improve the environmental performance of the supply chain. Utilizing clean
energy sources is regarded as one of the most effective strategies for promoting
sustainability within supply chain operations.
The implementation of GSCM practices has a significant impact on warehouse operations,
resulting in several benefits. One key advantage is the reduction of operational costs, as
measures for emission reduction and renewable energy use can significantly decrease
energy expenses. For instance, installing energy-efficient LED lighting or solar panels on
warehouse roofs can lead to substantial savings in electricity costs.

Moreover, GSCM practices contribute to space optimization and improved waste

management. Effective recycling and waste management strategies reduce the amount of
waste that needs to be stored or processed, thereby optimizing the use of warehouse space
and lowering waste management-related expenses. Additionally, this contributes to
creating better working conditions for employees by maintaining a cleaner and safer
environment. GSCM also facilitates enhanced operational efficiency by optimizing
logistics processes, such as through transportation route improvements or the adoption of
eco-friendly vehicles. These initiatives help reduce transportation time and improve the
efficiency of warehouse operations, leading to faster processing and delivery of goods. The
adoption of GSCM practices positively influences a company’s corporate image and
reputation. Implementing environmentally sustainable practices not only enhances
operational performance but also strengthens the company’s reputation among customers
and business partners. Companies that adopt GSCM are more likely to attract customers
due to their demonstrated commitment to environmental protection (Hsu et al., n.d.).

2.3.3. Warehouse Management System - WMS

Warehouse Management Systems (WMS) serve as a technological solution aimed at

optimizing storage processes and improving warehouse productivity. They achieve this by
coordinating various integrated storage activities while maintaining accurate inventory
records (Peisheng et al., 2020). WMS functions as a comprehensive system that manages
all warehouse-related tasks in the supply chain, such as receiving, storing, and handling
stock orders. This software is essential for monitoring inventory, raw materials, shipment
details, and customer feedback (Saxena, 2017). The adoption of WMS has increased
significantly in recent times, driven by the shift towards automated warehouses and
distribution centers (DCs), where dependency on manual labor is decreasing due to rising
labor costs and scarcity (Larutama et al., 2022).
Today, WMS is widely used across various sectors to improve warehouse operations and
streamline supply chain processes. Their usage has advanced to tackle modern business
challenges and leverage technological innovations. WMS plays a crucial role in multi-
channel retail by helping businesses manage inventory and orders across different sales
channels. It also supports effective returns management, simplifying reverse logistics. The
integration of automation technologies boosts workflow efficiency, while embedded data
analytics tools provide valuable insights for optimizing warehouse performance. Moreover,
WMS ensures compliance, traceability, and real-time tracking of shipments, which is
especially important for industries with strict regulatory requirements. The integration of
WMS with other enterprise systems and its ability to positively impact customer
experiences further emphasize its relevance in today's market. With scalability and
flexibility, WMS is suitable for businesses of all sizes and industries. As technology
continues to evolve, WMS will keep adapting to the changing demands of a globally
interconnected business landscape.

2.4. Research gaps

In the context of globalization and rapid supply chain expansion, an efficient warehouse
system is critical for organizations seeking to reduce costs and increase competitiveness.
Many international studies have focused on enhancing warehouse management through the
use of technology and sophisticated management techniques. However, these studies have
several limitations when applied to emerging markets like Vietnam. Most studies focus on
industrialized countries, which limits their geographical scope and fails to adequately
reflect the features and challenges of developing economies. (Faveto et al., n.d.).

Furthermore, a lot of previous research has focused exclusively on internal enterprise

factors—such process optimization or technology application—while ignoring external
issues like supply chain dynamics, infrastructure, and the effects of macroeconomic policy
(Malinowska et al., 2018). Additionally, a lot of research is limited to one or a small number
of particular organizations, which lowers the representativeness and generalizability of
study findings in a variety of settings (Senior & Analyst, 2020).
With an average growth rate of 14-16% per year, the logistics industry in Vietnam is on
the rise. However, logistics costs in Vietnam still account for about 20-25% of GDP, much
higher than the global average. Therefore, more comprehensive studies are needed to assess
the factors affecting warehouse management in the local context, in order to find solutions
suitable to market conditions and incomplete infrastructure. This additional research will
help provide deeper insights into the current state of warehouse management in Vietnam,
while supporting businesses to optimize their supply chains and improve operational
efficiency in an internationally competitive environment.

2.5. Hypothesis development

2.5.1. Variables
Based on our literature review on related models on articles in the past, we determine there
are six key factors that overall influence the warehouse system in a sustainable supply chain.
All variables chosen have been carefully examined and filtered based on 4 models related
to 4 articles on literature review on the topic section above.

Firstly, about independent variables, there are 4 main factors:

• Operation: This encompasses all activities related to the handling, storage, and
distribution of goods within a warehouse. It includes processes such as receiving,
transferring, handling, storing, packing, and expediting products. Efficient
warehouse operations are essential for ensuring that goods are managed effectively
and that customer expectations are met in terms of delivery and service quality
(Saifudin et al., 2012).
• Layout: Plays a critical role in enhancing efficiency within the supply chain. It
involves strategically organizing the space and materials to streamline operations,
minimize production cycles, reduce idle times, and eliminate bottlenecks in material
handling. A well-designed layout begins with profiling the warehouse’s specific
needs and benchmarking industry best practices to optimize space utilization.
Incorporating automation and streamlined processes within the layout can further
 improve productivity and reduce operational costs. Key components such as the
arrangement of racks, dock areas, and equipment significantly influence overall
efficiency. Additionally, flexibility in the layout is essential, allowing the warehouse
to adapt to changes in customer demand or inventory needs without requiring
frequent modifications (Jermsittiparsert et al., 2019).
• Economic: Refers to the financial aspect of warehouse performance, which includes
indicators such as cost efficiency, profitability, and value generation. Specifically,
economic performance focuses on optimizing operations, reducing costs, and
increasing revenue without compromising social and environmental factors.
Sustainable warehouses aim to balance economic goals with environmental and
social responsibilities, ensuring that while maximizing financial outcomes, the
company also minimizes its negative impact on society and the environment
(Torabizadeh et al., 2020).
• Environmental: Refers to the impact of warehouse operations on the natural
environment. This includes efforts to reduce energy consumption, minimize
greenhouse gas emissions, manage waste efficiently, and promote the use of
recyclable materials. Environmental performance is measured by indicators such as
energy efficiency, reduction in water usage, carbon footprint, and adherence to
environmental regulations. These factors aim to ensure that warehouse operations
are sustainable, limiting negative environmental impacts while contributing to long-
term ecological health (Torabizadeh et al., 2020).

Secondly, about mediating variables, there are 2 main factors:

• Management information system (MIS): MIS is described as a crucial component

that supports warehouse operations by providing timely and accurate information.
This information is essential for managing the various processes involved in
warehousing, such as receiving, storing, and handling goods. The effectiveness of
 MIS directly influences the efficiency of warehouse operations and overall
performance of the manufacturing firms involved (Jermsittiparsert et al., 2019).
• Resources: Refer to the various inputs utilized in warehouse operations, including
physical materials, energy, labor, and equipment. Effective resource management
focuses on optimizing the use of these assets to reduce waste and enhance efficiency.
This includes managing natural resources like water and energy, minimizing
material waste, and ensuring the efficient use of labor and technological tools. The
goal is to balance resource consumption with sustainability, reducing the
environmental impact while maintaining operational efficiency and cost-
effectiveness (Torabizadeh et al., 2020).

Finally, about dependent variables, we integrate the dependent factors like inside those
models: warehouse performance, warehouse efficiency into one main variable called
warehouse system.

2.5.2. Hypotheses
From those determined variables in above section, we set out hypotheses:

H1: Economic factors have a significant positive impact on the efficiency of the warehouse
system.

Rationale: Economic considerations such as cost efficiency and profitability directly

influence warehouse performance by optimizing financial resources.

H2: The efficiency of warehouse operations positively affects the overall performance of
the warehouse system.

Rationale: Streamlined operations reduce lead times and improve the flow of goods, thus
enhancing the system’s effectiveness.

H3: Layout design has a significant positive influence on the functionality of the warehouse
system.
Rationale: An optimized layout reduces material handling time, improves space utilization,
and enhances overall warehouse performance.

H4: The use of Management Information Systems (MIS) mediates the relationship between
operations and warehouse system performance.

Rationale: MIS can enhance decision-making by improving data management and

operational visibility, thereby impacting warehouse efficiency.

H5: Environmental factors have a significant positive influence on resource management

in the warehouse system.

Rationale: Incorporating environmentally friendly practices (such as energy efficiency and

waste reduction) leads to more effective resource utilization in the warehouse.

H6: Resource management positively influences the performance of the warehouse system.

Rationale: Efficient resource allocation and utilization directly enhance the operational
efficiency of the warehouse system.

Below here is the conceptual model for our topic:

 ASSESSMENT QUESTION
Please indicate your level of agreement or disagreement with the following statements
1. Strongly disagree
2. Disagree
3. Neutral
4. Agree
5. Strongly agree

Enco
Description Degree
de
1 2 3 4 5
Layout
LY1 The enterprise's warehouse has the
ability to expand space or easily
upgrade when there is a need to
increase capacity when necessary
LY2 The enterprise's warehouse has security
measures such as surveillance cameras,
fire alarm systems, and secure locking
doors
LY3 The enterprise's warehouse has good
conditions to preserve perishable or
temperature-sensitive goods
LY4 The enterprise's warehouse has a
system and standards for arranging
goods suitable for picking/delivery
activities
LY5 The warehouse uses storage space
effectively, avoiding unnecessary
waste of space
Operations
OP1 Clear and efficient warehouse
processes for receiving, inventorying
and storing goods
OP2 The goods receiving process ensures
proper specifications, avoiding
confusion or loss
OP3 The picking, packing and delivery
process is fast and accurate
 The warehouse has sufficient resources
and tools to ensure timely order
processing
OP4 The warehouse has a regular inventory
process to ensure the accuracy of
inventory
OP5 The process of moving goods within
the warehouse (between storage and
inventory areas) is carried out quickly
and safely
Economic factors
EC1 Changes in loan interest rates have a
negative impact on investment in
upgrading or expanding the warehouse
system
EC2 Global economic factors, such as the
financial crisis, affect a business's
ability to maintain inventory.
EC3 Tax and fee policies related to
warehousing directly affect business
profits.
EC4 Inflation has a major impact on
warehouse management and
maintenance costs.
EC5 Changes in foreign exchange rates
affect the cost of importing and
exporting goods held in warehouses.
EC6 Rising labor costs have a major impact
on warehouse personnel management.
Environment factors
EV1 Our warehouse systems are well
designed to ensure that hazardous
factors are not overlooked.
EV2 We use effective environmental
protection measures in our warehouse
operations.
EV3 Our warehouse construction materials
are resistant to climatic fluctuations.
EV4 Our warehouse management systems
are constantly updated to meet
environmental requirements.
EV5 We optimize energy and minimize
carbon emissions during warehouse
operations.
Management Information Systems
MIS1 Our management information system
helps to optimize the process of storing
and arranging goods in the warehouse.
MIS2 We use MIS system to track and
manage inventory accurately and
efficiently.
MIS3 Management information system helps
to improve the process of ordering and
shipping goods from the warehouse.
MIS4 We rely on MIS system to monitor the
performance and productivity of the
warehouse.
MIS5 Our management information system
provides real-time reports on the status
of goods in the warehouse.
MIS6 Using MIS helps us to make strategic
decisions about warehouse
management faster and more
accurately.
MIS7 MIS system helps to improve space
management and optimize storage area
in the warehouse.
MIS8 Integrating MIS into warehouse
operations helps to minimize errors and
incidents in goods management.
Resources
RS1 Our manage resources such as
materials, energy, labor and equipment
efficiently to optimize warehouse
operations.
RS2 Our energy use measures in
warehouses are designed to minimize
waste and maximize efficiency.
RS3 Our resource management system
ensures sustainable use of water and
energy.
RS4 Our labor use in warehouses is
optimized through an efficient
management system.
 RS5 Our processes ensure that material
waste is minimized throughout
warehouse operations.

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