The inhibitors of supply chain collaboration in the informal sector retail in Soweto

Abstract

The purpose of this study is to explore the inhibitors of supply chain collaboration in the informal sector retail in Soweto. This qualitative study draws from supply chain management and collaboration literature. The resource based view and stakeholder theory are explored in the attempt to understand why given the benefits of supply chain collaboration, the practice is not adopted to ensure firms sustainability in the informal sector. South AfricaÕs services sector has been identified as the sector to absorb the majority of the job losses experienced in the manufacturing industry. A significant part of this sector is made up of retail operations, which exist in both the informal sector and the formal sector. With extensive research on supply chain, supply chain collaboration and stakeholder relationships done in formal sector firms, this research aims to look at the concept of supply chain collaboration in informal sector retail in Soweto. The survival of informal sector firms is paramount as literature shows us that in emerging countries such as South Africa the informal sector absorbs a large part of the employed population. 17in-depth interviews were conducted. The respondents were selected using snowballing technique to identify interviewees who could shed light on the topic. A total of 13 interviews were included in the study. Findings were that there are inefficiencies in the current way in which informal sector retailers interact with their supply chain. Having considered the concept the perceptions on the concept as a solution to sustainable business was viewed as positive. Interviewees showed an interest in future collaboration but only after the main inhibitor of supply chain collaboration, trust, is addressed using means suggested in the study.