The Effect of Supply Chain Responsiveness, Flexibility, & Quality on Customer Development

Abstract

This study examines the impact of supply chain responsiveness, flexibility, and quality on a firm’s ability to attract, satisfy and retain its customers. Moreover, mediating impact of logistics process responsiveness among operation system responsiveness, supplier network responsiveness, supply chain flexibility, supply chain quality, and customer development is examined as well. For this study we have used the quantitative approach, a survey-based method for data collection with a total of 155 questionnaires distributed to FMCG firms in Jakarta with 119 usable responses retrieved. The effects of supply chain responsiveness, flexibility, and quality on customer development were analyzed using partial least squares structural equation modeling (SEM-PLS). The result confirmed the positive impact of supply chain responsiveness, flexibility, and quality on customer development. The finding also showed that the operations system responsiveness, supplier network responsiveness, supply chain flexibility, and quality drive the logistics system responsiveness. Additionally, logistics process responsiveness partially mediated the effect of operations system responsiveness, supplier network responsiveness, supply chain flexibility, and supply chain quality on customer development.