In the dynamic landscape of the pharmaceutical retail industry, staying competitive is important for survival and growth. Digital technologies have significantly altered consumer behavior, making incorporating technology a fundamental aspect of retail operations. In this context, the role of third-party logistics (3PL) providers becomes paramount in ensuring a seamless and efficient supply chain. This study investigated the impact of a store’s digital usage on its business performance and how the 3PL’s performance and the customer orientation of the store can change the effect. Additionally, a store inventory model was employed as a control variable to account for inventory management practices’ potential influence on the outcomes.
Using a quantitative approach, a structured survey was conducted to gather data on 568 respondents from various pharmaceutical retail stores, capturing crucial insights into their operational dynamics. The data analysis employed correlation, regression, and mediation analysis to assess the impact of digital usage on business performance within the dynamics of 3PL’s performance and customer orientation.
The results highlighted that digital integration positively influences overall business performance, indicating that adopting digital solutions enhances customer experiences and operational efficiencies. Further, customer orientation and 3PL’s performance were found to mediate the association between digital usage and store performance. Retail stores with a customer-centric focus demonstrated greater digital adoption, emphasizing the importance of aligning digital strategies with customer preferences and demands. Moreover, the store inventory management style did not modify the overall effect.
The implications of this research extended to pharmaceutical retail industry stakeholders, 3PL providers, and policymakers. The findings provided valuable insights into leveraging digital technologies for competitive advantage. The study also comprehensively explained customer orientation and 3PL performance towards the business performance. The findings contributed to the growing knowledge of supply chain management, digital transformation, and business performance in the pharmaceutical retail sector. By bridging gaps in the existing literature, the study enabled stakeholders to make informed decisions in navigating the dynamic landscape of the pharmaceutical retail industry effectively.