SUPPLY CHAIN MANAGEMENT PRACTICES AND OPERATIONAL PERFORMANCE OF FAIR PRICE SHOPS IN INDIA: AN EMPIRICAL STUDY

Background: In the current business environment, competition is no longer between the organisations but it is among the supply chains of the organisations. India’s public distribution system is one of the biggest systems for food supply and distribution carried out through fair price shop (FPS). There is a wide gap concerning the empirical study on the fair price shops (FPS) and this is the rationale of the study.

The paper aims to determine the relationship between different supply chain management practices and operational performance of the fair price shops in India. The authors propose the theoretical framework and empirically test the model. The study aims to expand the knowledge structure of supply chain management field.

Methods: The paper opted for an exploratory cum descriptive study. The authors randomly selected 200 Fair price shops from a list available on the government website and identified the key persons from each shop as the respondent to get our questionnaire filled. The data were collected using structured questionnaire. Total 200 questionnaires were given to MBA students to collect the data from those fair price shops dealers who qualify the screening questions and situated in Bhopal Madhya Pradesh (India) in  the month of March – April’  2017. Finally, 87 useful questionnaires were obtained, with a response rate of 43.5%, Authors employed the PLS-structural equation modelling (SEM) to test the theoretical model and hypothesis.

Results: The study provides that three dimensions of SCM practices have a significant and positive relationship with the operational performance. The paper provides empirical insights about how change is brought about operational performance of the fair price shops. It suggests that supply chain management practices positively & significantly associated with the performance of fair price shops.

Conclusion: This paper emphasizes the importance of supply chain management practices on the day to day operations of the fair price shops and provides an insight that these practices if employed properly they will give an added advantage. The study fulfils an identified need to study how supply chain management practices can impact the performance of fair price shops and the study directly measures the impact of supply chain management practices on operational performance of the fair price shops in India. The biggest limitation of this study is the size of the sample. Thus the research results may not be generalized. Therefore, researchers are encouraged to test the proposed framework at a broader level.