EFFECT OF SUPPLY CHAIN PRACTICES ON OPERATIONAL PERFORMANCE IN THE CASE OF THE BREWERY INDUSTRY

The main aim of this empirical research is to investigate the direct effect of supply chain practices (SCPs) on the operational performance of the Ethiopian Brewery Industry. This research conceptualizes and develops six dimensions of SCPs (viz., strategic supplier partnership, level of information sharing, quality of information sharing, customer relationship, internal lean practices, and mass customization) and tests the relationships between SCPs (independent variables) and OP (dependent variable). The quantitative research approach and the descriptive study design were adopted for the study. The simple random sampling method was used to select respondents from one of the well-known brewery industry in Ethiopia. Data for the study were collected from 113 respondents by using a five-point Likert scale survey questionnaire. The study employed the partial least squares (PLS) method in the estimation of the structural equation model (SEM) effect in SCPs on OP. A measurement PLS model is developed using SmartPLS software (version 3) and refined with reliability and validity tests. The results show that strategic supplier partnership and customer relationship management are positively and significantly related to OP of the Ethiopian Brewery Industry. The results indicate that higher levels of SCPs can lead to enhanced OP. The paper concludes that efficient SCPs will result in more OP. The result of this study contributes to the literature on SCPs by analysing the effect of SCPs on the OP towards a Brewery Industry capabilities perspective in a specific Ethiopian industrial context.