Is Lean Supply an Option for SMEs in the Automotive Industry

Abstract

It is widely claimed that the lean supply concept has enabled both buyers and suppliers to engage in collaborative relationships based on mutual dependencies and shared risk and reward. The concept has ultimately allowed both parties to engage in the collective identification and elimination of waste across the broad range of activities that determine the purchasing and supply process. The study ascertains the many internal and external challenges that MSMEs face when trying to achieve equitable amounts of value from the lean supply concept with larger, more powerful suppliers. Internal issues—such as limited purchasing spends, restrictions in the availability of resources, and an inherent fear and distrust of long-term commitment—limit the potential for small firms to embrace the concept. External factors such as power and dependency and a reduced ability to influence the larger players in the market also contribute to the difficulties for MSMEs.