Supplier integration, green sustainability programs, and financial performance of fashion enterprises under global financial crisis

Abstract

Fashion business is sensitive to economic situations, and supplier integration (SI) and green sustainability programs (GSP) are two timely issues in the fashion industry. Undoubtedly, both SI and GSP require significant resources and continuous commitment which affect cash flows and resource allocation of the fashion enterprises. How SI and GSP affect the financial performance of the fashion enterprises under the global financial crisis is hence an important issue. Motivated by the above relationship and based on publicly available data, this study aims to explore empirically (i) the impact of SI and GSP adoption on the financial performance of fashion enterprises, (ii) the ability of SI and GSP adoption to alleviate adversity owing to financial crisis, and (iii) the moderating effect brought by fashion content on the above relationships. The findings reveal that (i) both SI and GSP adoption can significantly improve the financial performance of the fashion enterprises, (ii) both SI and GSP adoption help to mitigate the adverse effect of financial tsunami on the fashion enterprise's financial performance; and (iii) fashion content has a moderating effect for fashion enterprises which sell fashionable items (i.e., “fashionable group”) to increase profits through a higher level of SI or executing GSP to act against financial tsunami. Managerial implications and insights are discussed.