Supplier Orientation and Furniture Manufacturing Small and Medium Enterprises’ Performance in Dar es Salaam, Tanzania: Customer Loyalty’s Role

Supplier orientation’s role in augmenting firms’ performance is gaining increasing attention from scholars. However, empirical research examining this relationship remains limited. Examination of the effects of supplier orientation dimensions on SMEs’ performance in the sector involved in furniture manufacturing in Dar es Salaam, Tanzania was undertaken, focusing on the mediating role of customer loyalty. Using a quantitative correlational design, data from 350 furniture manufacturing SMEs through a cross-sectional questionnaire-based survey were attained. By employing covariance-based structural equation modelling, the analysis revealed that customer loyalty partially acted as a mediator between supplier orientation dimensions and furniture-manufacturing SMEs performance relationships. Notably, collaborative relationships with suppliers exhibited the strongest positive indirect effect on furniture-manufacturing SMEs performance (β = 0.1621), followed by information sharing with suppliers (β = 0.1265). In contrast, supplier evaluation and selection exhibited the weakest indirect effect (β = 0.0543). The outcomes stipulate the importance of fostering long-term collaborative relationships and effective information sharing with suppliers to enhance customer loyalty and drive superior firm performance. The furniture manufacturing SMEs should prioritise in building long-term supplier collaborations that create synergy for open communication and value co-creation to nurture customer loyalty and, consequently, drive superior firm performance.