International Journal of Business Analytics and Security (IJBAS), Vol.1, Issue.1, 2022
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THE IMPACT OF PULL SUPPLY CHAIN STRATEGY AND JUST IN
CASE ON SUPPLY CHAIN PERFORMANCE
Muhammad Turki Alshurideh 1, Barween Al Kurdi 2, Samer Hamadneh 3
1
Department of Marketing, School of Business, The University of Jordan, Amman 11942, Jordan, Orcid
[0000-0002-7336-381X], m.alshurideh@ju.edu.jo
2
Department of Marketing, Faculty of Economics and Administrative Sciences, The Hashemite
University, P.O. Box 330127, Zarqa 13133, Jordan. Orcid [0000-0002-0825-4617],
barween@hu.edu.jo
3
Department of Marketing, School of Business, The University of Jordan, Amman 11942, Jordan,
s.hamadneh@ju.edu.jo
ABSTRACT
Every successful businesses rely substantially on effective supply chain management in order to
execute its daily operations. Organizational operations management processes profoundly depends
on expedient supply chain performance. Some of the most prosperous businesses in the world,
including Amazon and Walmart, largely rely on cutting-edge supply chain logistics methods. As
a result, all elements of the chain experience significant innovation in this very active market.
Therefore, to examine the Pull strategy and Just in case impact on supply chain performance with
the help of profound literature, and researches.
Keywords: Pull Supply Chain, Just In Case, Supply Chain Performance
1. INTRODUCTION
A quick responding business is considered to be growing and successful business in the
competitive market. More interestingly, business success and development has great charge on its
effective supply chain management [1]. In order to justify the supply chain strategies that helps in
inventory management, cost effective production and goods provision by exact demand forecast
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[2], [3]. Just-in-case (JIC) supply chain management has gained popularity recently, especially in
the wake of the coronavirus epidemic [4], [5]. By carrying additional inventory and incorporating
redundancy into their supply chains, businesses can respond to unforeseen demand points or
reduce supply disruptions [6]–[8]. This is a more conservative strategy. Even though increasing
stock levels will result in higher carrying costs and capital commitments, they might ultimately
prove to be more profitable [9], [10]. Having the appropriate stock on hand could increase sales
and provide businesses a competitive edge [11]–[14]. For the purpose to this research pull chain
strategy and just in case strategy considered as dependent variable that need to be assessed by
evaluating the supply chain performance. This research would contribute in the literature and great
source of knowledge for practitioners in manufacturing industries.
1.1.
Problem Statement
Companies maintain significant accumulations as part of their "just in case" (JIC) inventory
strategy. By using this technique, the likelihood that a product would run out of stock is reduced.
When a business employs this tactic, it frequently struggles to forecast consumer demand or
encounters demand uncertainty, even though JIC is a trending topic but can be found rarely in the
research [15], [16]. Therefore, this research is presented with theoretical space that would
strengthen the literature and knowledge support for professionals regarding successful supply
chain in order to measure the strategical influence of supply chain.
2. THEORETICAL FRAMEWORK
2.1. Pull Supply Chain Strategy
The consumer business industry in business and trade market either it is small and big, the whole
business operations only depending on the sufficient operational strategy of the supply chain
management that helps to meet the required goals of the businesses [17]–[19]. Supply chain
industry working on the goals of manufacturing of the raw material to the furnished product in
consumers hands [20]. The pull supply chain strategy in business has its own conditions to work
and deal with the customers [21]–[23]. The pull supply chain industry focuses on the consumer’s
specific needs that they required in custom -made products. The consumers ordered significant
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products and materials and supplier must be deliver the product that meet the demand of the
customer on time [24]. In any industry for example, the company who is dealing in interior
designing of the décor in residential and commercial sectors [25]. They should be focus on the
specifications of the designing of the material, lights, color, texture and many other related things
that meet the customer’s interest and satisfaction and then after finalization of the customers, the
design goes for the production [26]–[28]. The pull strategy of the supply chain management giving
save edge to the suppliers in which they confirmed the sale of the product and then they create the
order [29]–[31]. Business owners can save their capitals for investment and do no invested on
those projects that are not relate to the customer’s need.
2.2.
Just in Case
The just in case is one of the strategies in supply chain management in which the business
companies in retail industry manufacturing the products in bulk and storage them in ware houses
than its expected need and demand [32], [33]. The just in case business model of the supply chain
management increasing the value of the demand of the products at any time and supplier will be
able to fulfill the consumer demand [34]. The just in case is a business forecasting method in which
suppliers are ready to meet the requirements of the products especially in the quantity that is some
time not possible to manufacture on time [35]–[37]. The just in time strategy fill the gap between
the order taking and delivery process of the products to its consumers [38]. It confirms the
inventory management in storage that provide the sufficient need of the market at any time [39].
The just in time method of business reduce the risk factors that are involved in the cost effective
models, raw material availability, change of consumer needs, interest and many other related
factors that are involved because the ready inventories are on the risk at ware houses and any time
their demand can be decrease [10], [40], [41]. The just in time method is opposite to just in case
that is only focusing on the products that are ready according to customer requirements [42]–[44].
Just in case business model creating uncertainty among the suppliers and business holders due to
its huge quantity of the ready finished products in which huge cost is invested and it is needed to
be sold on time otherwise the demand and quality can be affected due to various factors [45].
2.3. Supply Chain Performance
Supply chain management is a process of business that is running the operational and functional
activities of the global business industry to meet the requirements of the customers on time [46]–
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[48]. The successful business outcome relay on its planning and development of the supply chain
assistance and placed their position in market [49]. The supply chain management performance is
depending on the operations of the business that are imitating by the raw material purchasing to
manufacturing of the products, their demand of the suppliers and finally ready items and goods
would be available in market for consumer needs [21], [50]. The supply chain performance is the
end stage of the businesses in which companies set their outcomes and measure their performances
of the businesses [51], [52]. Since recent years where construction infrastructure places its high
position in the world and number of residential and commercial projects are under construction at
biggest level the trend of the interior designing and its related beautiful art and features also taking
place in consumer industry [53]. People are getting aware for the décor items in their house holds
and commercial business properties [26], [54], [55]. The supply chain industry of the retail interior
designing market is quite impressive and it has huge margin of the profits if the supply chain
performance is efficient in terms of consumer needs and satisfaction. The supply chain
performance of the interior décor industry focusing on all ideas that are generated by the
architecture, cost of production material, efficient quality and services, consumers aptitude and
behavior towards the demand are involved [56]–[60]. The supply chain performance in business
strategies is also related with the employee’s interest, efficiency of the business model, suppliers’
commitments and on time delivery of the products to their concerned authorities.
2.4. Operational Definition
2.4.1. Pull Supply Chain Strategy
The operational line of the pull supply chain strategy in businesses is quite unique then other
strategies in which material is ready in bulk but it has many associated risk factors [61], [62]. The
pull strategy of supply chain helps to business owners to save their capital only for those objects
that are confirmed in order taking process and then goes for production [36], [63]. The pull strategy
is depending on the consumptions of the customers according to their needs. The pull strategy also
focusing on the trends of the market and its requirement of the customers that could be change at
any time due to several reasons [64]. The pull demand strategy of supply chain has less loyalty of
the business because it is only focusing on limited market and product and only taking initiative
for those objectives that are in running levels.
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2.4.2. Just in Case
Just in case is the strategic approach in the supply chain management where the organization have
sufficient amount of inventory to meet the demands of customers [65], [66]. The operational
strategy of the just in case in supply chain management is a process of inventories that are ready
in stock [67] and prepared to distribute in market at the time of the order but there are number of
associated factors are involved [68]–[70] in just in case method in which reliability of the suppliers,
production cost of the raw material, storage capacity and ware house cost, fuel, transportations and
most important the change of consumer behavior at any time in market [42], [71], [72]. The just
in case strategy also effected by the innovation in market with new product features that can reduce
the demand of the existing stock [73], [74]. Where business trends are moving fast and the
consumer needs and behavior also going to be change, at this stage, the just in case strategy of the
supply chain management facing many issues [75], [76]. The ultimate change of consumer
behavior is a most challenging situation for the business owners who already prepared bulk
quantity of the products and they are doing effort to sold them urgently [77]–[80]. The just in case
method also involved with the factor in which at the time of the order of the customer, they need
urgent delivery of the products and just in case strategy helps to achieve the supplier’s goals
efficiently with the help of their finished goods in stock [81].
2.4.3. Supply Chain Performance
The operational management of supply chain performance is a measuring tool that decides the
actual operational activity that meet the goals of the industry and satisfy the needs of customers by
providing the required products [82]. The successful businesses are relating with the supply chain
performance that create the efficiency and reliability of the entire objectives that are involved in
operations [83]–[85]. The supply chain performance focusing on the quality of the products and
create the huge margins of the profitable outcomes and deliver best customer experiences [86],
[87]. The supply chain performance in business organizations focuses on the product
manufacturing to their deliveries with accuracy of the commitments with their customers [88],
[89]. in order to face the competition in retail business industry and especially in interior décor
where number of interior designer are coming in market and giving competitive ideas in cost
effective prices, the supply chain performance is one and only option that helps to customers to
get quality services and develop the trust on its suppliers [90]–[93]. The quality product and
services on time delivery opportunities is a basic requirement of the customers that they are
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expecting to their suppliers and performing measures of the supply chain [94]helps to develop the
resources to meet the demand of the customers [95], [96]. Customers gain trust on those suppliers
who are committed and focusing on the delivery of the products on time [97]. The technology
implementation in business industry especially in supply chain management is one of the
revolutions in business that helps to evaluate the customers’ needs and their demand with product
features and creating possibilities to deliver their order on time [98]–[100]. The technology also
improves the efficiency of the performance of the supply chain in business industry.
3. LITERATURE REVIEW
The timing of product fabrication, delivery to distribution hubs, and availability in the retail
channel is determined by supply chain strategy. In a pull supply chain, process is driven by current
customer demand, but in a push supply chain, strategy is driven by long-term forecasts of consumer
need [101], [102]. [103] investigated that modern management system needs just in time and pull
strategy to meet demands. The relationship between our both independent variables the pull supply
chain strategy and just in case is quite different to each other [104]. The pull strategy of the supply
chain mainly focusing on those objectives that are only significant with customers needs for their
specific requirements in product making and distribution [105]–[107]. While just in case is a
supply chain model that manufacturing the inventories in bulk in stock in order to meet customers
immediate demand and do not want to lose the customer’s expectations [108], [109]. The pull
supply chain strategy is the safest way to secure the investors capitals in production unit while
there are number of risk factors are involved in just in case strategy to maintain the product
inventories for a longer period of time [110]–[112].
Pull chain strategy and supply chain performance has significant role in the effectiveness of
operations [113], [114]. The pull supply chain strategy and supply chain performance has
significance association [115], [116]. Our dependent variable of the supply chain performance is
one of the business unit measure that is involved in all kind of operational and functional activities
of the business industry and no business can succeed its goals without supply chain management
performance [117]–[121]. The business forecasting evaluates the all risk factors and design
policies that can overcome the threats on time and making possible solutions to maintain their
effective performance of supply chain [105]. The pull strategy has the great effect of performing
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measures of the supply chain [122]because the pull strategy do not effort to sale their products
because it is already customer -made that is design by the unique features that are the demand of
the customers and supply chain performance already placed its position [1], [123].
[124] evaluated Just in case has significant impact on supply chain performance. The relationship
of the just in case and supply chain performance is relating to each other in effectively. The study
has proved that the just in case is mainly focusing on the material production that is in huge
quantity in order to meet the customer requirements on immediate order delivery [125], [126]. The
just in case business model is depending on the business organizations forecasting in which they
assume the demand of the market at any time and there are many risk factors are involved in just
in case method [127], [128]. The only supply chain performance can create the efficiency of the
product delivery in market through the supplier’s commitments and product efficiency to increase
the demand among the customers [129], [130].
[131] explained the impact of pull chain and just in case on the supply chain performance to meet
the needs. The relationship of both independent variables of pull supply chain strategy and just in
case with dependent variable of supply chain performance are associated [132]. The both
independent variables relay on supply chain performance in business success [133], [134]. The
pull strategy focusing only those objectives that are confirmed from customers for specific
requirements while just in case developing huge quantity of the products that is associate with the
risk factors due to many reasons of market change behavior and inventory management system
[135], [136]. The both independent variables only can create the business efficiency with the help
of effective supply chain management and performance measures that are required for successful
business outcomes in all industries [137] especially in interior décor where consumer change
behavior is rapidly growing and expecting new ideas from their suppliers [138], [139]. Both supply
chain strategies of pull and just in case need strong polices to manage the performance of the
supply chain management in order to develop the sale and profit of the ready items in market.
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3.1 General Research Model
Pull Supply
Chain
H1
H3
Just In Case
Supply Chain
Performance
H2
Figure1: Conceptual Research Model
4. DISCUSSION
Companies rely on supply chain management to handle the process swiftly and effectively, from
the acquisition of raw materials to all necessary processing and the final delivery of goods. When
a product should be manufactured, transferred to storage facilities, delivered to a retail location, or
shipped is determined by supply chains. This is a difficult task that mainly relies on future-proofing
to take delays into consideration. Organizations can plan out their supplies based on a variety of
criteria based on their precise demands with the use of supply chain strategies. Just-in-case supply
chains work by foreseeing customer needs. Companies utilize just-in-case supply chain resilience
techniques to lower the risk of stock outs caused by widespread disruptions and complexity that
has positive impact on supply chain performance of any organization. Carrying as much inventory
as you can to hide bad forecasting techniques shouldn't be the goal of just-in-case inventory
management. An effective JIC strategy depends on accurate demand forecasting. Finding the ideal
balance between satisfying demand and not buying too much stock is crucial that may ultimately
leads toward improved SC performance. Whereas, a pull supply chain's manufacturing and supply
processes are driven by actual consumer demand. In this type of supply chain logistics, inventory
is acquired based on demand. One advantage of using this method of planning when demand is
low is that there will be less waste.
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5. CONCLUSION
There are several ways that just-in-case inventory management can support expansion and
profitability. This research concludes the several authors’ argument that shows an increased
competitiveness and supply chain performance are better able to manage business operations. The
strategic implementation of supply chain enhances the inventory management, order delivering
efficiently and cost effectively. The just in case strategy and pull chain strategy figure out various
advantages for the growing supply chain management. In contrast the pull chain strategy
administer the inventory management focused on the unique requirements that customers had for
custom-made goods. Customers ordered large quantities of goods and supplies, and the supplier
had to meet the deadline by delivering the goods. These strategies help the organizations to
implement in order to acquire supply chain performance and sustainable competitive edge.
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