The purpose of this paper is to investigate how buyer–supplier social capital may help mitigate operational supply risk (OSR) of small- and medium-sized enterprises (SMEs). It empirically examines a framework that posits the direct and mediated impacts of three dimensions of buyer–supplier social capital – structural, relational and cognitive – and supplier integration on the OSR of SMEs and consequently their operational performance.
This study uses data collected via a questionnaire from 485 manufacturing SMEs in Bangladesh for analysis using structural equation modeling.
The analysis reveals that all the three dimensions of buyer–supplier social capital can effectively reduce the OSR of SMEs, either directly or indirectly through supplier integration. The mediating role of supplier integration in the relationship between social capital and OSR is confirmed and the negative impact of OSR on operational performances of SMEs is verified.
Generalization of the findings needs to be prudent since the study gathered information only from manufacturing SMEs in Bangladesh on the buyer side of the buyer–supplier dyad.