Effectiveness of Supply Chain Management on Fashion Industry of
Transcript of Effectiveness of Supply Chain Management on Fashion Industry of
Effectiveness of Supply Chain Management on Fashion Industry of Pakistan 1
Proceedings of 2nd International Conference on Business Management (ISBN: 978-969-9368-06-6)
EFFECTIVENESS OF SUPPLY CHAIN MANAGEMENT ON FASHION INDUSTRY
Effectiveness of Supply Chain Management on Fashion Industry of Pakistan
Muhammad Babar, Muhammad Bilal
National University of Sciences and Technology
Islamabad, Pakistan.
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Proceedings of 2nd International Conference on Business Management (ISBN: 978-969-9368-06-6)
Abstract
The aim of this paper is to find the effectiveness of supply chain management on the fashion
industry of Pakistan. The purpose was to see whether there is any contribution by supply
chain in the growth of the fashion industry. A research has been carried out in firms, by
applying primary research tools mainly questionnaire. A quantitative research has been
carried out which showed that a strong relationship is existing of quality and sourcing and a
moderate relationship of on time delivery and planning as independent variables of supply
chain on fashion industry in Pakistan.
Keywords – Supply chain, Fashion industry
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Introduction
Supply chain management (SCM) is the synchronized set of procedures to design and
implement all the steps which is used in acquiring raw materials from suppliers, process
those into finished goods and providing it to end users. It consists of chain-wide information,
planning, resource management and universal performance measurement. Main goal of SCM
is to minimize the lead time and also reducing cost of the product. There are different
variables that affect SCM. Those variables are planning and management of logistics, raw
material transportation, better infrastructure, proper warehouses and extremely competent
planning and controlling of shipments. All those variables help in lowering the lead time of
value chain and cost.
If we look at the trends in textile and fashion industries of the world, the thing we notice is
that the lead time is decreasing day by day. Textile and clothing is one of the oldest sectors in
the history of the industrial development. Textile and clothing is one of the top
manufacturing industries throughout the world and it is contributing considerably towards the
economic growth of developing countries [1]. Textile industry contributes a good portion of
the Pakistani exports and thus helping Pakistani economy. Fashion industry and textile go
hand in hand as all the raw material needed in fashion industry comes from textile and
clothing industry. As per the Oscar Wilde "Fashion is a form of ugliness so intolerable that
we have to alter it every six months."
They must do whatever it takes to stay on top of textile and fashion industries [3]. The
delivery of products of fashion items in terms of lead-time and cost has changed. The
competition has increased and it has become hostile in recent times [3]. The root causes of
this situation are high demands, advancements in technology and the globalization process
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[4]. Also, always research the company or individual you will be interviewing with [5]. The
objective of this research is to analyze the overall performance of supply chain management
of fashion industry in Pakistan.
Methodology
To conduct this research, primary data was collected in the form of questionnaires as the
research tool from Kohinoor mills Rawalpindi Islamabad. A standardized questionnaire was
developed and delivered to the respondents to gather data. Primary data was collected from
30 respondents. The theoretical framework was developed to measure the supply chain of
fashion industry on the dimensions of planning, quality, sourcing and on time delivery. The
statistical tool used for evaluating and interpreting the questionnaires into meaningful
information for resulting analysis is Statistical Package for Social Sciences (SPSS).
Figure 1: Theoretical Framework
Figure 1 explains the theoretical framework used in the study. Four independent variables or
dimensions namely quality, sourcing, planning and on time delivery are used to measure the
dependent variable supply chain management.
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Discussion
TABLE I shows the respective Cronbach alphas of 4 independent variables used in the study.
Variables titled are quality, planning, sourcing and on time delivery. Among these four
variables sourcing and quality showed high internal consistency of 0.706 and 0.691
respectively, whereas planning and on time delivery showed a relatively lower internal
consistency of 0.547 and 0.519 respectively.
Table I: Reliability Stats for Independent Variable
TABLE II illustrates the mean scores of planning. Among the items used to measure this
dimension, defined marketing plan shows the highest mean score of 2.03. The items of
underutilized capacity, industrial planning and machine upgrading show relatively lower
mean scores of 2.0 each. The rest of items show very low mean scores.Table II: Mean Score
of Planning
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Proceedings of 2nd International Conference on Business Management (ISBN: 978-969-9368-06-6)
TABLE III illustrates the mean scores of quality. Among the items used to measure this
dimension, imported raw material shows the highest mean score of 2.5. This means the
highest dependency of this item on the dimension. On the other hand, the item of
compensation comparison show the least mean score of 2.03 which shows the lowest
dependency of this item on the dimension of quality
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Table III: Mean Score of Quality
TABLE 1V illustrates the mean scores of sourcing. Among the items used to measure this
dimension, modes of transportation shows the highest mean of 2.70 among all the items with
sourcing as a dimension. Another item that showed a very high mean is transportation in
Pakistan which is 2.60 which means that it’s contributing a lot to the supply chain
management. Order delivery within the lead time however shows the lowest mean score of
1.87. This shows a poor contribution to this dimension and hence to supply chain
management.
TABLE V illustrates the mean scores of on time delivery as a dimension. Among the items
used to measure this dimension, contacting retailers to estimate demand shows the highest
mean score of 2.07 which means supply and availability on time is highly contributing to this
dimension and so to the supply chain management. Responding to fluctuations in market
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however shows the lowest mean score of 1.77. This shows a poor contribution to this
dimension and so to the supply chain management.
Table IV: Mean Score of Sourcing
Table V: On Time Delivery
Table VI illustrates the correlation table between the dependent variable supply chain and the
independent variables quality, planning, sourcing and on time delivery. The table shows that
correlation is significant between the dependent and independent variables. Quality and
sourcing are showing significantly strong correlation with the dependent variable supply
chain management. Quality is showing a correlation of 64.9% and sourcing of 64.1%. On
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time delivery is also correlated significantly to supply chain management and showing a
value 62.2%. The dimension of planning is showing a relatively lower but good correlation
of 50.6%. As a whole, all the independent variables are strongly correlated to the dependent
variable.
Table VII shows the regression analysis of the dependent variable supply chain management
and independent variable quality. The value of the R square comes out to be 0.421 which
shows that 42.1 % of supply chain management (dependent variable) is explained by the
independent variable quality.
Table VI: Correlation Table
Table VII: ANOVA of Quality
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Table VIII shows the regression analysis of the dependent variable supply chain management
and independent variable sourcing. The value of the R square comes out to be 0.441 which
shows that 44.1% of supply chain management (dependent variable) is explained by the
independent variable sourcing.
Table VIII: ANOVA of Sourcing
Table IX shows the regression analysis of the dependent variable supply chain management
and independent variable on time delivery. The value of the R square comes out to be 0.387
which shows that 38.7% of supply chain management (dependent variable) is explained by
the independent variable on time delivery.
Table IX: ANOVA of On Time Delivery
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Table X shows the regression analysis of the dependent variable supply chain management
and independent variable planning. The value of the R square comes out to be 0.256 which
shows that 25.6 % of supply chain management (dependent variable) is explained by the
independent variable planning.
Table X: ANOVA of Planning
Figure 2 illustrates a scatter plot matrix showing the extent of correlation between all the
variables used in the study. The scatter plot proves that a strong correlation exists between
the four independent variables with the dependent variable
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Figure 2: Correlation Diagram
Figure 3 explains the scatter plot matrix of the regression analysis of the independent variable
sourcing and the dependent variable supply chain management. The figure clearly shows the
value of R square or coefficient of determination which shows a more realistic and authentic
result of the regression coefficient. The value of R square for sourcing is 0.441 which shows
that dependent variable supply chain is explained or predicted by a value of 44.1% by the
independent variable sourcing. This proves a moderate fit relation between dependent and
independent variable.
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Figure 3: Regression of Sourcing
Figure 4 explains the scatter plot matrix of the regression analysis of the independent variable
on time delivery and the dependent variable supply chain management. The figure clearly
shows the value of R square or coefficient of determination which shows a more realistic and
authentic result of the regression coefficient. The value of R square for sourcing is 0.387
which shows that dependent variable supply chain is explained or predicted by a value of
38.7% by the independent variable on time delivery. This proves a moderate fit relation
between dependent and independent variable.
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Figure 4: Regression of on time Delivery
Figure 5 explains the scatter plot matrix of the regression analysis of the independent variable
planning and the dependent variable supply chain management. The figure clearly shows the
value of R square or coefficient of determination which shows a more realistic and authentic
result of the regression coefficient. The value of R square for sourcing is 0.256 which shows
that dependent variable supply chain is explained or predicted by a value of 25.6% by the
independent variable planning. This proves a modest fit relation between dependent and
independent variable.
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Figure 5: Regression of Planning
Figure 6 explains the scatter plot matrix of the regression analysis of the independent variable
quality and the dependent variable supply chain management. The figure clearly shows the
value of R square or coefficient of determination which shows a more realistic and authentic
result of the regression coefficient. The value of R square for sourcing is 0.421 which shows
that dependent variable supply chain is explained or predicted by a value of 42.1% by the
independent variable quality. This proves a moderate fit relation between dependent and
independent variable and the strongest than other independent variables.
Figure 6: Regression of Quality
Conclusion
On the basis of the findings, we can conclude that among all the independent variables,
sourcing as an independent variable is showing highest reliability i.e. 0.706 and hence
proving that the research is a reliable one. Also quality as a dimension showing 0.691 score,
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proving it`s high reliability. Other two dimensions, namely are planning and on time delivery
showing their respective reliabilities of 0.547 and 0.519 respectively as well. Overall, we can
infer that the research is a reliable and valid one. Also, on the basis of above findings, it is
concluded that the quality showing a correlation of 64.9% and is significantly correlated to
our dependent variable supply chain management. Other dimension showing a high
correlation of 64.1% is sourcing, hence highly correlated to supply chain management. .
Out of the four dimensions, on time delivery showing a correlation of 62.2% and planning
with 50.6% showing a bit moderate correlation to supply chain management. On part of the
regression analysis, out of the dimensions, sourcing as an independent variable is explaining
our dependent variable supply chain management to a value of 44.1%. Second to that quality
as an independent variable is explaining the dependent variable to a value of 42.1%. Also on
time delivery is explaining to a value of 38.7% and planning is explaining supply chain
management with a value of 25.6%.
We conclude that as fashion industry in Pakistan has been growing for the past 5, 6 years at
reasonably good pace, supply chain is playing a very major role in the growth of fashion
industry. We strongly recommend that supply chain must be given the primary importance in
order to keep the growing at the rapid speed. Also on the final words, we hope that this
research would provide a great deal of help to the prospect scholars and the organizations
working for the fashion industry. This knowledge will open the new horizons of study for
them.
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