Table of Contents
Sustainability along the supply chain within the tobacco industry
The tobacco industry has within it a supply chain that is characterized by raw product development, manufacturing, marketing, and distribution phases (Lopez‐Gonzalez, 2015, p.1682-1721). Therefore, the supply chain involves all steps that contribute to the formation of the product and its reach to customers. According to Siddiqi et al., (2015, p.424-430), supply chain sustainability in the tobacco industry is achieved through regulatory policy making and implementation. The supply chain sustainability has to encompass environment, social and economic consciousness (Lee et al., 2016, p.507). Usually, environmental and social capabilities ensure knowledge sharing and environment conservation while economic sustainability ensures profitable use of factors of production (Lee et al., 2016, p.507). According to Briones (2015, p.43-42), tobacco industry economic sustainability strategies are based on scale and legal agreements. The scholar claims that large scale operations and contract farming have high levels of economic sustainability.
Sustainability within buyer-supplier relationship along the supply chain system in the tobacco industry
Buyer-supplier relationship determines the economic prosperity of tobacco companies and is mainly influenced by its activities regarding information sharing and collaboration. According to Lee et al., (2016, p.506), exchange of information is highly significant in enhancing buyer supplier relationship and brings about mutual trust and partnership that is a form of investment in the market. Additionally, the relationship affects the shared knowledge about performance and expectations hence it is easier to wind up the gap (Lee et al., 2016, p.506). Whenever the relationship is highly collaborative, buyers and consumers work hand in hand to develop technology and critically solve problems through improvement initiatives (Lee et al., 2016, p.506). It is worth noting that companies have most of their expenditure in the form of raw material and services purchases hence attention should be focused on suppliers who can give them a competitive edge and sustainability (Ghayoomi, 2013, p.2).
- Baldwin, R. and Lopez‐Gonzalez, J., 2015. Supply‐chain Trade: A Portrait of Global Patterns and Several Testable Hypotheses. The World Economy, 38(11), pp.1682-1721.
- Briones, R.M., 2015. Small farmers in high-value chains: binding or relaxing constraints to inclusive growth?. World Development, 72, pp.43-52.
- Ghayoomi, O., 2013. Practices, Success Factors and Barriers in Supplier Development based on Buyer-Supplier Dyads in Tobacco Industry.
- Lee, J.S., Kim, S.K. and Lee, S.Y., 2016. Sustainable supply chain capabilities: Accumulation, strategic types and performance. Sustainability, 8(6), p.503.
- Siddiqi, K., Scammell, K., Huque, R., Khan, A., Baral, S., Ali, S. and Watt, I., 2015. Smokeless tobacco supply chain in south asia: a comparative analysis using the WHO framework convention on tobacco control. Nicotine & Tobacco Research, 18(4), pp.424-430.