Understanding Organized Retail Supply Chain Performance Indicators for Business Growth

Understanding Organized Retail Supply Chain Performance Indicators for Business Growth

Rajwinder Singh (International Management Institute, Bhubaneswar, India), H. S. Sandhu (CKD Institute of Management and Technology, Amritsar, India), B. A. Metri (International Management Institute, New Delhi, India) and Rajinder Kaur (Department of Management Studies, Malout Institute of Management and Information Technology, Malout, India)
Copyright: © 2014 |Pages: 13
DOI: 10.4018/ijkbo.2014040105
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Abstract

The socio-economic developments in India have pushed the demand for fresh farm products at the doorsteps. This is good for organized non-livestock retailing (NLR) which is retailing of agriculture and horticulture products. Expecting the better return, many national and international retailers are in the arena. The intense market competition has changed the scenario to supply chain vs. supply chain competition. This has prompted to understand key performance indicators (KPI) for this industry. In this research, the KPI are classified using factor analysis (FA) as: inventory metrics, customer metrics, flexibility metrics, and growth and learning metrics. Structural Equation Modelling (SEM) approach has been applied to test the hypothesis. The results support the hypothesis; (1) firms with more focus on inventory need more focus on flexibility; (2) firms with more focus on flexibility shall have higher level of growth and learning; and (3) firms with more focus on inventory shall have higher level of growth and learning. The primary data was collected from top 10 organized NLR players operating in Punjab, Chandigarh, New Delhi, and Gurgaon in India. Finally, 401 questionnaires were received. The results were tested and validated by rigorous statistical analysis.
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Supply Chain Performance Indicators

Measuring SC performance remained the key managerial agenda for manufacturing sector. In the early 1990s, the focus was on financial measures. Later on, the literature witnessed the shift to financial and customer measures (Kaplan & Norton, 1996; Supply-Chain Council, 2000; Lambert & Terrance, 2001; Li et al., 2005). In the late 2000, service sector came in a big way and dominated the manufacturing sector. Many researchers identified KPI for manufacturing and service sectors: Gary (2005)-service, assets, efficiency, and speed; Shepherd and Gunter (2006)-cost, time, quality, flexibility, and innovation; Ferry et al. (2007)- flexibility, efficiency, food quality, and responsiveness. Later on, virtual enterprises came into existence. Zheng and Lai (2008) in their study on SC dynamic performance measurement of agile virtual enterprise (AVE) identified; management of finance, customers, international operations, and ability to learn and growth as KPI for measuring SC performance. They further developed 5D dynamic BSC model and identified 15 performance measures i.e. profitability, capital to turnover ratio, capital turnaround time, customer satisfaction, market share, market growth rate, response time, merchandise turnover ratio, reject rate, technique advantage, profit growth rate, employee satisfaction degree, research and development of new products, punctual delivery rate, and flexibility.

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