SUPPLY CHAIN MANAGEMENT PRACTICES AND PERFORMANCES OF FAFFA FOOD SHARE COMPANY

Abstract

In most Ethiopian food manufacturing industries including Fafa, the supply chain strategies and activities were not clearly described and articulated. The supply chain decisions in this sector are mostly intended to gain short term returns. In addition, the customer focused and internally focused performance attributes of the supply chain system were not diagnosed and evaluated for improvement and benchmarking. The general objectives of the study are to investigate the supply chain management practices and performances of Faffa Food Share Company. Descriptive and quantitative methods of research were used and data were collected by interview questions, document review and questionnaires. Open and close ended questionnaires were used to describe the supply chain practices and supply chain performances using data obtained from secondary data sources. It was found that, sourcing strategy and relationship management with majority of suppliers is reactive supplier selection and supplier dominant arm’s length respectively. Low capacity utilization and efficiency for majority of production lines is not favorable for product focus production strategy. Reliability and responsiveness of the supply chain is good. Customer satisfaction on pre transaction and transaction supply chain services is strong. But, it is weak with post transaction supply chain services. It is concluded that, the supply chain practices and performance is not bad despite many internal and system wide challenges. Number of specific recommendations revolving around sourcing, relationship management, and make or buy decisions were given. In addition, it is recommended to invest and work more in streamlining the SC system integration with supply chain partners through objective alignment, collaboration, data visibility, streamlining processes through removing unnecessary steps, and increasing responsiveness and resilience.