Published Online:June 2025
Product Name:The IUP Journal of Supply Chain Management
Product Type:Article
Product Code:IJSCM020625
DOI:10.71329/IUPJSCM/2025.22.2.39-61
Author Name:Rajeev N
Availability:YES
Subject/Domain:Management
Download Format:PDF
Pages:39-61
This study investigates the key supply chain variables affecting the financial performance of SMEs. For this purpose, the performance of businesses in Coimbatore, Tamil Nadu, and Palakkad, Kerala, is compared. The study used survey methodology to collect data and analyzed the same to identify the critical factors influencing the firm performance of 50 SMEs. Altogether 20 Supply Chain Variables with a statistically significant relationship to VA were identified through a literature survey and subsequent discussions with experts. These variables include Level of automation, Level of Kaizen implementation, Level of just-in-time implementation, Frequency of raw material ordering, Safety stock planning level, Lead time, Capacity utilization level, ERP implementation level, Production type, VMI implementation, Number of stockouts, Frequency of demand forecast, Purchase effectiveness, Employee training, Inventory cost, Extent of outsourcing, Interaction with supplier, Interaction with customer, Supplier empowerment, Perceived importance of government policies and support. Various analyses such as, correlation, regression, factor analysis, and discriminant analysis were conducted. The result showed that returns to scale values of enterprises in Palakkad and Coimbatore displayed significant differences. The Coimbatore firms were found to have an increasing returns to scale, whereas Palakkad firms showed a decreasing returns to scale.
Small and medium enterprises (SMEs) are businesses that employ fewer people and usually have lower operating budgets than larger businesses. Companies are occasionally categorized based on their annual sales, workforce size, or other financial and economic factors, as there is no uniform definition for SMEs. SMEs contribute significantly to