Effect of supply chain management practices on customer development and start-up performance

Abstract

Purpose The number of entrepreneurial start-ups operating in developing countries has grown tremendously in recent years. However, research suggests that most start-ups in developing countries fail shortly after becoming operational. The purpose of this paper explores how supply chain management (SCM) practices may enhance the performance of start-ups in developing countries. Design/methodology/approach The study develops and empirically tests a research model which explores the effect of SCM practices on customer development and start-up performance. A survey of 300 start-ups operating in Ghana was conducted, with 72 usable responses obtained. The research model was analyzed using partial least squares structural equation modeling. Findings The results confirmed the positive impact of SCM practices on customer development and start-up performance. Customer development was also found to positively impact start-up performance. Additionally, a partial mediation role of customer development on relationship between SCM practices and start-up performance was observed. Originality/value To the best of the researchers’ knowledge, this is the first study that empirically explores the effects of SCM practices on the performance of start-ups. This is also the first study that examines the effect of SCM practices on customer development to the best of the researchers’ knowledge.