The impact of power, benefits, and risk reduction on the performance of supply chain of Sri Lankan apparel and food & beverages industries

Abstract

Supply chain performance (SCP) can be determined through many factors such as technical factors and relationship factors. The relationship factors mainly focus on the supply chain linkages (SCLs) created with the upstream and downstream supply chain partners. Therefore, the SCLs such as Power, Benefits, and Risk Reduction are important to any industry to enhance their SCP. This paper examines the level of impact of the Power, Benefits, and Risk Reduction on the SCP. The SCLs and the SCP are analyzed and compared using two types of industries as Apparel (AI), and Food & Beverages (F&BI) that established in Free Trade Zones in Western Province Sri Lanka. A total of 138 Managers in the fields of Supply Chain (SC) related activities were surveyed (88-AI, 50-F&BI) through a self-administrative questionnaire. Risk Reduction and Power together demonstrate a significant influence on the SCP in manufacturing sector in Sri Lanka. Further, 'Industry type' moderates the relationships of Power to SCP and Risk Reduction to SCP but not the Benefits to SCP. In F&BI, the Power, Benefits, and Risk Reduction demonstrate significant (5% level) relationships with SCP but, the Power is not showing significant (5% level) relationship with SCP in AI. In F&BI, Risk Reduction and Benefits together demonstrate significant influence on SCP. But in AI, Benefits with the Power demonstrate significant influence on SCP. AI shows higher level of SCP than the F&BI, when the same level of Power and Risk Reduction apply to their own Supply Chain.