Green Practices and Performance of Logistics Firms in Nairobi City County, Kenya
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Date
2025-12
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Kenyatta University
Abstract
The logistics sector plays a critical role in Kenya’s economic growth, contributing
significantly to GDP and employment. However, logistics firms in Nairobi City County
continue to experience inconsistent performance, partly due to increasing
environmental demands, inefficient operational processes, and the slow adoption of
sustainable practices. Although global supply chains are progressively embracing green
logistics, the extent to which such practices enhance firm performance in the Kenyan
context remains insufficiently explored. This study therefore sought to examine the
influence of green logistics practices—specifically eco-design, green packaging, green
warehousing, and reverse logistics—on the performance of logistics firms in Nairobi
City County. The specific objectives were: to determine the effect of eco-design on
firm performance, to assess the influence of green packaging on firm performance, to
evaluate how green warehousing practices affect firm performance and to examine the
effect of reverse logistics on the performance of logistics firms. Guided by stakeholder
theory, the resource-based view, and game theory, the study explains how
environmental responsibility, internal resource capabilities, and strategic interactions
with market and regulatory stakeholders shape firm performance outcomes. A
descriptive research design was employed, and primary data were collected from
managers of logistics firms registered with the Kenya International Freight and
Warehousing Association (KIFWA). The findings revealed that eco-design
significantly improved operational efficiency and overall firm performance by
promoting lifecycle-oriented product and process optimization. Green packaging
exhibited a positive and significant effect, largely by reducing waste, lowering cost
pressures, and improving brand perception. Similarly, green warehousing practices
enhanced performance through improved resource utilization and energy-efficient
storage systems, while reverse logistics contributed to performance by enabling
sustainable handling of returned products, waste reduction, and recovery of residual
value. Based on these findings, the study recommends intensified adoption of green
packaging initiatives, including the use of biodegradable, recyclable, and reusable
materials, as well as optimizing design to minimize waste and environmental impact.
Strengthening eco-design, warehousing efficiency, and reverse logistics systems can
further enhance operational performance, reduce costs, and bolster the competitiveness
of logistics firms within Nairobi City County. The study underscores the strategic value
of green logistics as a pathway to both environmental sustainability and improved
organizational outcomes.
Description
A Research Project Submitted to the School of Business, Economics and Tourism in Partial Fulfillment of the Requirements for the Award of the Degree of Master of Business Administration (Procurement and Supply Chain Management) of Kenyatta University. December, 2025
supervisor
Perris Chege