The impact of buyer-supplier relationship and purchasing process on the supply chain performance: a conceptual framework
Melody J. Hsiao
University of Sydney
University of Western Australia
University of Sydney
Supply chain performance is a rapidly developing area of research. Many companies are trying to find tools for enhancing performance measures in response to turbulent business markets and for efficiently controlling their business activities. Little empirical research has been conducted on the performance of retail supply chain in Taiwan and other Asian countries. Two factors affecting current retail supply chains, buyer-supplier relationships and purchasing processes, and their antecedents that are relevant to this unique cultural environment will be investigated. The objectives of this research are: (1) to identify the determinants affecting the performance of the supply chain at the retail level; (2) to define the antecedents related to each determinant; and (3) to present the conceptual model for this particular context. This research will contribute by presenting a conceptual model for supply chain performance that is relevant to small and mediumsized businesses that predominate Taiwan. INTRODUCTION
Supply chain management (SCM) is “a key strategic factor for increasing organizational effectiveness and for better realization of organizational goals such as enhanced competitiveness, better customer care and increased profitability” (Gunasekaran et al. 2001, p. 71). The major goals of SCM are to minimize non-value-added activities and associated investment cost and operating cost, increase customer responsiveness and flexibility in the supply chain, and enhance bottom- line performance and cost competitiveness (Stewart 1995). A recent study conducted by Petrovic- Lazarevic and Sohal (2002) reported that effective management of the supply chain has been identified as being of significant importance to achieving and sustaining a competitive advantage for firms in the Australian textiles, clothing, and footwear industry.
Many companies are trying to find tools for performance improvement in response to turbulent business markets and for efficiently controlling their business activities. The objectives of performance measurement are to improve the efficiency and effectiveness of a supply chain (Beamon 1999; Gunasekaran et al. 2001). In addition, Keeber (2000) also stated that the purpose of performance measurement is to reduce operating costs and customer service in logistics activities, improve firm’s revenue growth, and enhance shareholder value.
Sportswear is a globalised industry, with major production undertaken in Asian countries, and three international brands dominating worldwide sales – Nike and Rebook from the US, and Adidas from Europe (Just-style.com 2001). Moreover, sports superstars, TV sports programs and sports activities have great influence on this market. The sportswear market possesses the same characteristics as the fashion market: strong seasonality, short product life, volatile demand, and high impulse purchasing (Christopher and Peck 1997; Fisher et al. 1994; Fisher et al. 2000). The seasons are affected not only by weather but also by the sporting calendar (Ashford 1997). The costs of stockout and markdown for big companies like Sport Obermeyer would be more than 10% of sales (Fisher et al. 1994). Thus, supply chain management in the sportswear market is critical to ensure that stock does not become out dated with the short product life cycle resulting in stockout and markdowns, thus reducing profits at the retail level. The reasons for conducting such a research in the context of Taiwan are: (1) Taiwan lies at an advantageous geographic location in the Asia-Pacific region, which is the hub position connected to Northeast Asia, Southeast Asia and coastal mainland China (Taiwan Headlines 31 January 2000), and it is why the government...
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