CHAPTER I THE PROBLEM AND ITS BACKGROUND This chapter presents the n what the research is all about,

, limitations and delimitation of nition of technical terms used in background of the study which focuses mainly o its objectives, framework, significance, scope the study. This chapter also includes the defi the entire study.

Introduction In the midst of trade facilitation and globalization, every nation must continue to formulate and re-formulate marketing strategies designed for greater local a nd global competitiveness, customer-driven and innovative. As the business compe tition gets even tougher, delivering value to the customer turns to be accentuat ed. Nowadays, the focus is to provide products and services having more value a s compared to its competitors. But that emphasis should not only place on these products and services they offer, it should also be on the suppliers and custome rs. Thus, the goal should be customer, supplier and profit-oriented that present s quality outputs, both products and services. With this, the role of managing the supply chain promotes better market conditioning. The growth of supply chain, according to Braunscheidel (2005), aims to improve p rofitability, customer response and ability to deliver value to the customers an d also to improve the interconnection and interdependence among firms. Due to to day s expansion of market, customer demands continuously increase. Thus, the end cus tomer in the marketplace today determined by the success of failure of supply ch ains management practices. These supply chain practices earned its recognition a s one of the leading factors in determining profitability, giving respect to cus tomer demands. Many professionals have claimed that getting the right product, at the right pri ce, at the right time to the customer does not only improve competitive success but also the key to survival. Many previous researches explored the importance o f integrating suppliers, manufacturers, and customers or supply chain integratio n so as to obtain flexibility and speed. Consecutively, by addressing supply cha in management practices that contribute supply chain responsiveness, researchers would gain better understanding on the scope and activities related to supply c hain management that creates enhanced level of supply chain responsiveness in co mpetitive business marketplace. One of the better examples of a business that hi ghlights the importance of supply chain management is National Book Store. Over sixty years of focused energy has brought to where it is now: the pinnacle of the book store industry in the Philippines- National Book Store. They are aim ing to be the nation s largest bookstore that provide quality products and services and complete list of items needed by an individual both for business an educatio nal purposes. More than that, they take pride in its role as an institution that supports education and enhances lives by providing the best and widest selectio n of educational, professional, and social communication products. At this point , supply chain management plays how vital it is in reaching out these goals. Thu s, National Book Store operates nationwide and has two branches in Batangas City and two in Lipa City. These branches are strategically located in four major ma lls in both cities; Bay City Mall and SM Batangas in Batangas City and Robinsons Lipa and SM City Lipa in Lipa City. The main purpose of this study was to measure the supply chain management used i n different branches of National Book Store in Batangas City and Lipa City. Furt hermore, the study discussed the differences on these supply chain they are curr ently using as well as those which they thought to be useful in improving supply chain, The study also considered the practices they are using in improving the management of supply chain as well as the benefits derived from such integratio n. Problems these branches are facing were also included in this study. Statement of the Problem The main problem of the study was to assess the Supply Chain Management in Natio nal Book Store branches in Batangas City and Lipa City. Specifically, it abides to seek answers to the following questions.

1. g:

What is the demographic profile of the respondents based on the followin

a. Age; b. Gender; c. Educational Attainment; d. Position; and e. Length of service? 2. What are the supply chain management strategies used by different branch es of National Book Store in Batangas City and Lipa City? 3. What is the assessment of the respondents regarding the following supply chain strategies a. Close partnership with suppliers; b. Close partnership with customers; c. JIT supply; d. E-procurement; e. Outsourcing; f. Subcontracting; g. Plan strategically; h. Supply Chain Benchmarking; i. Vertical integration; j. Few suppliers; k. Many suppliers; l. Holding safety stock; and m. Use of external consultants? 4. What are the practices currently used by the branch to improve supply ch ain management? 5. Is the current practice of National Book Store branches in Lipa City an d Batangas City effective? 6. What are the benefits earned from using supply chain management practice s? 7. What are the problems commonly encountered from using supply chain mana gement practices? 8. Is there a significant difference in the three branches of National Book Store in Batangas City and Lipa City with regards to the following: a. on the supply chain management strategies used; b. practices currently used by the branch to improve supply chain managemen t; c. benefits earned from using supply chain management practices; and d. The problems commonly encountered from using supply chain management pra ctices? Conceptual Framework The researchers conceptualized a research about the supply chain management at a ll branches of National Book Store in Batangas City and Lipa City. The researche rs believed that there is a need to understand the said operations management co ncept to further improve their knowledge about supply chain management, practice s and strategies which give rise to various benefits and problems. The paradigm of the study was concerned on the assessment on the supply chain management at National Book Store branches in Batangas City and Lipa City. There were three frames formulated to describe the independent variables, inter vening variables and the dependent variables. The independent variables include several factors. First are the strateg ies that were normally applied by a business firm to improve supply chain manage ment. Another are practices to improve managing the supply chain which posed sev eral benefits and problems. Aside from this, the intervening variable also affects the result of thi s study. This included both the profiles of the branch and that of the responden ts. Branch s profile consisted of operating years and number of employees. The demo graphic profile of the respondents covered their age, gender, position and lengt h of service.

The dependent variable comprised the assessment on the supply chain mana gement at the three branches of National Book Store in Batangas City and Lipa Ci ty.

Figure 1 Conceptual Paradigm Hypotheses Ho1: The current practice of National Book Store branches in Lipa City and Batan gas City is not effective. Ho2: There is no significant difference on the supply chain management strategie s used by the three branches of National Book Store in Batangas City and Lipa Ci ty. Ho3: There is no significant difference on the supply chain management practices currently used by the branches of National Book Store in Batangas City and Lipa City. Ho4: There is no significant difference on the benefits earned from using suppl y chain management practices by the branches of National Book Store in Batangas City and Lipa City. Ho5: There is no significant difference on the problems commonly encountered by the branches of National Book Store in Batangas City and Lipa City from using su pply chain management practices.

Significance of the Study This chapter provided the concepts, principles, strategies and theories about Supply Chain Management used by the branches of National Book Store in Bat angas City and Lipa City. In conceptual definition, the uses, applications, prac tices, benefits, problems and strategies of Supply Chain Management were discuss ed. In related literature, there were history and other related studies about su pply chain management as a productivity and profitability tool. The conceptual l iterature and related studies served as guiding principles for the researchers a bout the current situation of National Book Store branches and to come up with i ts assessment. This study will provide insight and advance knowledge to contribute as a dditional information to serve the following individuals and organization. To the Branch Managers and employees of National Book Store, this study presented can be used for comparison among different branches. It will serve as a tool for improvement of supply chain management adopted by different branch re presentatives in the same industry. It will also remind the importance and benef its of supply chain to their operations. To the Future and Current Owners/Franchisor, this will be beneficial as

it evaluates the practice, strategies and practices of supply chain management, which are necessary to the development of the business and how it is done. To the National Book Stores and related Industries, this industry provid es as an inclusive specifications or indications for the use of effective supply chain management strategy and practice and successful implementation. This will serve as a tool to prevent or overcome the current problems of the book store. It will also help the company to be more competitive in the same industry and wi ll remain as leading book store in Philippines. To the students, this study will contribute additional knowledge to them who are primary customers of this business. This will help to determine the per ception of the effective supply chain management of the company s strategic decision ideas and to know more about the insights of being laking National. To the parents, this will be able to contribute to their awareness in ch oosing the products or school supplies that their children will use for their st udies. This will also serve them as additional information what the importance o f effective managing inventories in this company and to be more stable in their acquired materials or supplies. To the researchers, this study served as a great part of the completion of their course requirement. This has given them a lot of challenge and experience to me et different branch representatives and to allow them to have a conversation and to seek their approval in continuance of this study. This developed their self es teem and has been a competitive students in interacting with others, and kept th eir determination to finish what they have already started. This also led them t o discover new knowledge and widen their horizon. To the other researchers, this study will be an effective tool and refer ence as they intend to make any further relevant study particularly the supply c hain management practices, strategies and practices of leading book store in our country. Scope, Limitations and Delimitations This study looked on some aspects that determined the supply chain manag ement of National Book Store Inc. This discussed supply chain management strateg ies and practices together with the benefits gained from such implementation. T he researchers also included the problems the branch faces. The respondents of the study were composed of branch employees from 3 selected branches in Batangas City and Lipa City. The questionnaires were administered and retrieved after th ree weeks. As mentioned, this study was limited only to the perspective of the empl oyees. This means that the study relied only on strategies, practices, benefits and problems viewed by the employees as the branch manages its supply chain. Mor eover, the respondents of this study were employees from two branches of Nationa l Book Store in Batangas City namely Bay City Mall Branch and SM City Batangas B ranch and in Lipa City namely SM City Lipa and Robinsons Lipa. The number of respondents was limited to only 34 persons based on the co mputations to be presented in the following chapters. Also, the respondents inc luded those who have at least one (1) year of experience working in the National Book Store, making them capable and reliable to answer the questions raised by the researchers. The research design, data gathering techniques and statistical treatment were discussed in the Chapter 3. Unrestricted random sampling was use d in the study (no restrictions imposed) and every member of the population had equal chance of inclusion in the sample. Evaluative and comparative survey method was used in this study with the use of the questionnaire to determine the difference between the supply chain m anagement strategy and practice used in three branches of National Book Store in Batangas City and Lipa City. The results of the study were interpreted with the use of weighted arithmetic me an and analysis of variance after testing the normality of the data using skewne ss and kurtosis. Aside from this, the study had the following limitations. One is the dat a collected relied on employees views which could be prone to suggest bias. Althou

gh it was considered to be primary data, the survey relied mainly on the employe r s recall of their experiences and what they know. Also, the data gathering instrum ent used, survey questionnaires have inherent limitations which may call for res ponse bias. The respondents may have not revealed the truth and have answered wi th caution especially on information that they feel must be kept private or info rmation that are treated confidential by the company. The study was also prone to selection bias. Likewise, the selected sample was not representative of the actual number of workers employed in the three branches, and there were limitati ons on selecting respondents. Only known strategies and practices were used in t he questionnaire to limit the number unrecognized supply chain principles. Henc e, the study was not intended to make strategies in order to further improve the ir practice of managing supply chain. Knowing those problems commonly encountere d by the bookstore, the researchers would give exact and scientific recommendati ons to overcome totally those problems. Recommendations were only based on resea rchers deductions.