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Exploring the Role of Circular Economy Practices in Linking Green Logistics Management and IoT with Sustainability Performance in SMEs

Author

Listed:
  • Ilyas Masudin

    (Universitas Muhammadiyah Malang)

  • Annisa Selvia

    (Universitas Muhammadiyah Malang)

  • Fien Zulfikarijah

    (Universitas Muhammadiyah Malang)

  • Tsiqatun Nasyiah

    (Universitas Muhammadiyah Malang)

Abstract

This study aims to identify the key factors influencing sustainability performance in SMEs, focusing on green logistics management, the Internet of Things (IoT), and circular economy practices. Structural Equation Modeling (SEM) is applied to examine the direct and indirect relationships among these variables, while Fuzzy-Set Qualitative Comparative Analysis (FsQCA) identifies the configurations that lead to high sustainability performance. The findings highlight that green logistics management significantly enhances sustainability by improving operational efficiency and reducing environmental impacts through waste management and sustainable supply chain practices. IoT integration further strengthens sustainability performance by enabling real-time monitoring, optimizing production processes, and minimizing waste. Both green logistics and IoT positively influence circular economy practices, facilitating resource efficiency, waste reduction, and material recycling. Circular economy practices, in turn, directly enhance sustainability by promoting resource reuse and operational competitiveness. Moreover, circular economy practices partially mediate the effects of green logistics and IoT on sustainability performance, underscoring the importance of their integration. FsQCA results confirm that the combination of green logistics, IoT, and circular economy practices forms a robust strategy for sustainability, ensuring high consistency and coverage. This integrated approach serves as a key driver for sustainable business practices and market competitiveness in SMEs.

Suggested Citation

  • Ilyas Masudin & Annisa Selvia & Fien Zulfikarijah & Tsiqatun Nasyiah, 2025. "Exploring the Role of Circular Economy Practices in Linking Green Logistics Management and IoT with Sustainability Performance in SMEs," Circular Economy and Sustainability, Springer, vol. 5(5), pages 3787-3824, October.
    • Handle: RePEc:spr:circec:v:5:y:2025:i:5:d:10.1007_s43615-025-00598-0
    DOI: 10.1007/s43615-025-00598-0
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