Impact of Supply Chain Performance on Firms’ Export Capability: Development of a Statistical Model

Abstract

The purposes of this article are to establish the crucial indicators of supply chain performance (SCPI) impacting firms’ export performance, revealing its unique characteristics, and assess the effects of these SCPIs on the export capability of the firms. This article develops a statistical model, involving how critical SCPIs can influence firms’ export performance. The developed model is then empirically validated using top 53 firm-level data, based on market share, from the Indian pharmaceutical industry, taken for 10 years. The randomized complete block design approach is employed to confirm the variation of export intensity across firms and time. A panel data fixed-effects model is developed, associating critical SCPIs with export intensity to understand their impact on export performance. Finally, bootstrap is applied as a cross-validation procedure to carry out model authentication. This article contributes to obtaining crucial SCPIs and their impact on firms’ export competitiveness. It has revealed that firms’ raw material import efficiency, working capital efficiency, asset management efficiency, research and development (R&D) capability, and the total cost to serve have a significant impact on the firms’ export capability. The proposed model can help firms make appropriate decisions about different influencing parameters of supply chain performance to improve their export competitiveness.