Abstract:
In the increasingly competitive food processing industry, digital technologies are essential for
enhancing supply chain efficiency, flexibility, food quality and safety, reducing food loss,
reliability, tracking and traceability, and sustainability. Despite global advancements in supply
chain digitalization, there remains a research gap concerning its impact in developing regions;
specifically, within Ethiopian food processing firms. This study investigated the effect of
digitalization on food supply chain performance, focusing on K.O.J.J Food Processing Complex
PLC in Addis Ababa, Ethiopia, where limited research exists on its application in developing
countries. By addressing this gap, the study evaluated the effects of digitalization in three critical
areas: internal processes, supplier integration, and customer engagement, on key performance
metrics such as efficiency, flexibility, food quality and safety, food loss, reliability, tracking and
traceability, and sustainability. A mixed-methods approach was used, incorporating quantitative
data from 153 structured surveys conducted with employees, customers, and suppliers, alongside
qualitative insights from in-depth interviews with managers at different levels of the
organizational hierarchy. Simple random sampling was used to target internal staff, while
purposive sampling was employed to select external stakeholders. Data were analyzed using a
multivariate multiple regression models. The results revealed that digitalization of internal
processes were the most significant contributor, explaining 74.4% of the variance indicating its
critical role in enhancing operational efficiency. Following this, digitalization with suppliers
demonstrated a strong positive impact accounting for 56.5% of the variations significantly
improving food quality and safety while reducing food loss, lastly digitalization practices with
customers also contributed positively influenced traceability and customer satisfaction,
contributing 49.6%. These findings indicates that while all three digitalization practices are
essential for improving supply chain performance, the digitalization of internal processes is the
most influential, followed by supplier integration and customer engagement through real-time
data sharing as key drivers of supply chain performance. The study concludes that prioritizing
digital investments in supplier relationships and internal processes can significantly improve
food supply chain outcomes in Ethiopia. It is recommended that policymakers and industry
stakeholders support digitalization initiatives to enhance competitiveness, resilience, and
sustainability in the Ethiopian food processing sector.
