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Fac o s A ec ing Expo Pe o mance in S i
Lanka: wi h Especial Re e ence o Value-Added
Rubbe P oduc s Indus y
Sama asinghe KP
Depa men o Indus ial Managemen , Facul y o Applied Sciences,
Wayamba Uni e si y o S i Lanka, Kuliyapi iya (NWP), S i Lanka
Ka una a hne EACP
1
Depa men o Indus ial Managemen , Facul y o Applied Sciences,
Wayamba Uni e si y o S i Lanka, Kuliyapi iya (NWP), S i Lanka
Abs ac
The s udy was conduc ed o iden i y he de e minan s o he expo
pe o mance o he alue-added ubbe p oduc s indus y in S i Lanka. This
esea ch has iden i ied he impac o se e al selec ed ac o s on he expo
pe o mance and he s eng h o hose ac o s’ impac on he indus y. The
esea ch s udy was ca ied ou by pe o ming a comp ehensi e su ey by
ocusing exclusi ely on S i Lankan alue-added ubbe p oduc s expo e s.
Online ques ionnai e and in e iews we e used as esea ch ins umen s o ge he
eedback om a andomly selec ed sample which comp ises mo e han i y
pe cen o S i Lankan alue-added ubbe p oduc s expo e s. Fo he pu pose o
analysis, desc ip i e s a is ics we e comp ehensi ely used. De e minan s o
expo pe o mance ha e been iden i ied by e iewing li e a u e as i m
cha ac e is ics, ma ke ing s a egies, ma ke cha ac e is ics, echnical
capabili ies and he in es men po olio. These a iables’ ela ionships we e
analyzed and posi i e co ela ion was iden i ied wi h expo pe o mance. They
a e i m cha ac e is ics and echnical capabili ies. Thus, S i Lankan alue-added
ubbe p oduc s indus y can imp o e hei ma ke pe o mance by ocusing he
enhancemen o hose wo ac o s. Fu he , he echnical capabili y was
iden i ied as he mos signi ican ac o o he alue-added ubbe p oduc s’
expo pe o mance. The e o e i was ecommended he manu ac u e s
&expo e s o ocus on hei echnical capabili ies o gain mo e indus y
pe o mance.
1
Co esponding au ho ’s email: ch[email p o ec ed]
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781
Keywo ds: Expo Pe o mance, Value-Added Rubbe P oduc s,
Manu ac u ing Sec o , S i Lanka
Ci e his a icle: KP, S., & EACP, K. (2015). Fac o s A ec ing Expo Pe o mance in S i
Lanka: wi h Especial Re e ence o Value-Added Rubbe P oduc s Indus y. In e na ional
Jou nal o Managemen , Accoun ing and Economics, 2(7), 780-788.
In oduc ion
Acco ding o Expo De elopmen Boa d o S i Lanka in 2013, S i Lanka was he
wo ld’s six h la ges na u al ubbe expo e and he eigh h la ges na u al ubbe
p oducing coun y. As pe he S i Lanka Expo De elopmen Boa d, S i Lanka was well
known o manu ac u ing numbe o alue added ubbe p oduc s by p ocessing aw
ubbe . These ubbe p oduc s we e in e na ionally acclaimed and accep ed o quali y
and du abili y. Apa om indus ial solid i es and glo es, S i Lanka o e s ex usion
p oduc s, la ex p oduc s, indus ial p oduc s, and gene al ubbe p oduc s and ela ed
componen s o he expo ma ke . (S i Lanka Expo De elopmen Boa d, 2011).
The a e age sha e o he alue o inished p oduc s expo s was 81% o o al expo s
in 2007 and i was 83% in 2012. Howe e , yea on yea a e age g ow h a e o he o al
alue o inished ubbe p oduc s expo s was 36% om yea 2007-2008 and i has
dec eased o -10% om yea 2011-2012. Solid i e sec o is being he majo con ibu o
o S i Lankan expo alue, al hough he expo alue g ow h a e has been dec eased
app oxima ely by 5.7% om 2011 o 2012. Acco ding o S i Lanka Expo De elopmen
Boa d, in 2013 he main eason o his ecession had been iden i ied as he Eu opean
inancial c isis in 2012. Bu in he yea 2013, he expo pe o mance o inished ubbe
p oduc s o S i Lanka had gained only 2.85% o a posi i e g ow h.
Expo pe o mance can be de ined as a ela i e success o a ailu e o he e o o a
i m o na ion o sell domes ically-p oduced goods and se ices in o he na ions. Be e
gaining om expo ac i i ies esul ed in high expo pe o mance and na ions should
ha e supply capaci y o gain such pe o mance o e i s compe i o s. Va ious indica o s
such as capi al, echnical know-how, human esou ce, na u al esou ces, economic
s abili y, o eign di ec in es men s, e c. a e empowe ed o he highes expo
pe o mance o a na ion. Changes in he mac oeconomic en i onmen di ec ly e ec on
he expo pe o mance o he mos o coun ies in he wo ld (Fugazza, 2004). The expo
pe o mance de e minan s can be simila among na ions in he same geog aphical- egion
o else as de eloped and de eloping na ions. On he o he hand each indus y has i s own
expo pe o mance de e minan s and hose can be di e en om one indus y o ano he .
Li e a u e Re iew
Acco ding o he s udy conduc ed on he Malaysian expo ma ke , i e ealed he
us wo hiness, social ne wo ks’ a o and he iendship enhance he coope a ion wi h
hei ma ke which enable o expo sales g ow h (Behyan, Mohamad & Oma , 2011)..
On he o he hand, Sha ma (2003) has s udy he s a is ical signi icance on he o eign
di ec in es men and Indian expo ma ke pe o mance and s a ed he e was no
ela ionship al hough he co ela ion has showed a posi i e sign. Howe e in S i Lanka,
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782
he in es men po olio is a common ac o in he manu ac u ing sec o as mos o he
i ms unc ioning unde he Boa d o In es men in S i Lanka.
As pe he Oli ei a e al. in 2012, expo pe o mance indica o s o g ea es in e es
we e he economic measu es. These con ain sales ela ed dimensions such as sales g ow h
and e enues ela i e o ma ke sha e and p o i ela ed dimensions like p o i ma gins,
a ios and g ow h ends (Oli ei a e al., 2012).
Ce ain ac o s ha we e impac ing on he expo pe o mance ha e been iden i ied
om he li e a u e. F om he esea ch done by Babakus e al. in 2006, a posi i e
signi icance o he i m size on he o eign ne wo k and expo pe o mance had been
iden i ied (Babakus, Ya as & Haah i, 2006). Ca usgil and Nao (1987) concluded ha
he la ge he company he mo e likely i is o expo while Czinko a and Johns on, (1983)
sugges ed ha company size did no a ec ed expo ac i i ies.
Mos indings indica ed ha pe cei ed echnological s eng hs a e posi i ely ela ed o
p opensi y o expo (Aaby and Sla e , 1989). In con as , Nassimbeni in 2001 s a ed ha
he echnological p o ile was less ela ed o he expo a i udes o he small scale
manu ac u e s (Nassimbeni, 2001).
Li e a u e e ealed ma ke ing s a egies had a posi i e impac on expo pe o mance.
Usages o expo p omo ion p og ams posi i ely in luence manage s’ expo knowledge
and hei posi i e pe cep ion owa d expo ma ke en i onmen . This consequen ly
in luences manage s’ commi men o expo , i m expo s a egy and e en ually i m
expo pe o mance. Findings also indica ed ha i m manage s who used mo e o he
expo p omo ion p og ams ended o ha e posi i e a i ude owa d expo en i onmen ,
we e mo e knowledgeable abou expo ma ke s and expo p ocedu es, and we e mo e
commi ed o expo (Shamsuddoha & Ali, 2006).
En i onmen al cha ac e is ics such as compe i i e in ensi y and cus ome exposu e
we e iden i ied as ano he ac o o impac ing on expo s pe o mance. Compe i i e
in ensi y; in he expo ma ke he in ensi y o compe i ion could make i ms o seek a
high le el o p oduc and p omo ion adap a ion o gain a compe i i e bene i o e
compe i o s (Jain, 1989; Ca usgil e al., 1993). In a compe i i e expo ma ke , a high
le el o p oduc adap a ion is needed in o de o ha e a s ong compe i i e p essu e,
because p oduc adap a ion can help gain a compe i i e dominance o e compe i o s
(Ca usgil & Zou, 1994). As pe he Cadogan e al. in 2012 and Koksal in 2008, he expo
cus ome amilia i y wi h a pa icula b and o he p oduc made easie o en e in o an
expo ma ke and i equi ed low p omo ions o he expo ma ke . Fu he , i buil
a o able a i udes o cus ome s (Cadogan e al., 2012; Koksal, 2008).
Resea ch P oblem
Value-added ubbe p oduc s expo s con ibu ed posi i ely o he S i Lankan
economy and i is mo e p o i able han expo ing aw ubbe . As a esul , aw ubbe
expo has been dec eased las ew yea s due o i s usage by manu ac u e s in he Island.
In 2010 S i Lankan o e all expo s g ew by 18.2% compa ed o India 40.5%, Vie nam
26.4% and Thailand 28.1% (Kelegama, 2013) which s a ed a signi ican low g ow h in
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783
S i Lankan expo pe o mance compa ing o i s compe i o s. In he yea 2013, al hough
S i Lankan ubbe p oduc expo alue was g own by 2.85% compa ing o yea 2012,
he o al alue o ubbe p oduc expo in 2013 (US$ 666.07) was no eached he alue
o ha was epo ed in yea 2011(US$ 700.33 million). Since he e we e a lowe
pe o mance eco ded in he alue-added ubbe p oduc s indus y, as well as lowe
pe o mance compa ed o egional coun ies, he s udy was conduc ed o iden i y he main
de e minan s o expo pe o mance o alue-added ubbe p oduc s in S i Lanka.
Fu he mo e, he esea ch was a ge ed on assessing he le el o in luence o hose
de e minan s and o make ecommenda ions o he policy make s/ indus y o be e
pe o mance in ubbe p oduc s expo indus y.
Me hodology
Ini ially, li e a u e was e iewed and in e iews we e held simul aneously o iden i y
indica o s which de e mine he expo pe o mance. Acco dingly, sales olume, sales
g ow h, ma ke sha e, ma ke sha e g ow h, p o i ma gin g ow h and p o i abili y we e
iden i ied. On he o he hand, i m cha ac e is ics, expo ma ke ing s a egies, expo
ma ke cha ac e is ics, echnical capabili ies o he expo e and o eign in es men
po olio we e iden i ied as independen a iables. Based on hese ac s, esea ch
ques ionnai e was p epa ed and hypo heses we e de eloped. Resea ch ques ionnai e was
es ed o he eliabili y. Then, da a we e collec ed by deli e ing a s uc u ed online
ques ionnai e among ubbe p oduc s manu ac u ing and expo ing i ms. Then he
collec ed da a we e analyzed and conclusion and ecommenda ions we e made based on
indings.
Da a Collec ion and Analysis
P obabilis ic sampling had ollowed as sampling schedule and simple andom
sampling wi hou eplacemen was selec ed as he sampling echnique. To ha e a
minimum e o om sampling echnique, mo e han 50% o S i Lankan alue-added
ubbe p oduc s manu ac u e s and expo e s we e selec ed as he sample size.
The desc ip i e analysis o he da a e ealed ha mo e han 20% o expo ing ubbe
p oduc ype was i es. The second la ges expo ing ubbe p oduc was shoe soles wi h
15% o he o al expo s and hi d was glo es wi h 10% o he o al expo s. The o he
manu ac u ing and expo ing ubbe p oduc s we e ubes, hoses, ma s, o ms e c.
Acco ding o he indus y expe ience, nine y pe cen o ubbe p oduc s manu ac u e s
had less han 40 yea s o indus y expe ience in expo pe o mance and only 5% o he
manu ac u e s had o e 60 yea s o expe ience acco ding o he below Figu e 1.
In e na ional Jou nal o Managemen , Accoun ing and Economics
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784
Figu e 1 Expe ience o Rubbe P oduc s Manu ac u es in he Indus y
Fu he analysis ca ied ou o iden i y whe he he e a e signi ican beha io al
di e ences ela ed o he iden i ied a iables. Fo ha , K uskal Wallis es was used and
signi ican di e ences we e iden i ied o in es men po olio based on i m expe ience
in expo pe o mance.
Table 1 Tes S a is icsa-based on Fi m Expe ience
Fi m
Cha ac e is ics
Ma ke ing
S a egy
Ma ke
Cha ac e is ics
Technical
Capabili y
In es men
Po olio
Chi-Squa e
1.099
.634
.980
1.295
11.181
d
3
3
3
3
3
Asymp. Sig.
.777
.889
.806
.730
.011
a G ouping Va iable: Expe ience
E en hough he i m expe ience o he majo i y i ms we e less han 40 yea s, many
ubbe p oduc s manu ac u ing i ms had mo e han 300 employees and i is 35%. The e
we e 20% o i ms which had been unc ioning wi h less han 100 o employees and 40%
o i ms had employees be ween 100 and 300. When compa ing o o he expo ing
indus ies in S i Lanka, he employee engagemen in hese se o i ms was minimum.
Table 2 Numbe o Employees in he Fi ms
No. o Employees
Pe cen age
Less han 100 employees
25%
100 – 200 employees
20%
200 – 300 employees
20%
Mo e han 300 employees
35%
As pe he below Table 3, 95% o he ubbe p oduc s manu ac u e s ha e changed
hei s a ing manu ac u ing echnology due o he echnological ad ancemen in ce ain
e a and ye only 5% o he i ms had no changed hei echnology in he p ocess o
manu ac u ing inished ubbe p oduc s. F om he echnological change ha had done by
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785
he 65% o he i ms, 40% o hem had ealized 6% o 10% o an inc emen o hei sales
olume and 25% o i ms had ealized mo e han 20% o sales olume inc emen .
Table 3 Sales Inc emen a e Technology Change in Manu ac u ing
Sales Inc emen a e he
Technology Change in Fi ms
Pe cen age
6% - 10%
40%
11% - 20%
30%
Mo e han 20%
25%
Had no change he
Technology
05%
Co ela ion Analysis
When, signi ican alue is less han 0.05, hen he null hypo hesis (H0) was ejec ed
and he al e na i e hypo hesis was accep ed. Acco ding o he ou pu o he co ela ion o
he da a, all de e minan s showed posi i e associa ion wi h he expo pe o mance.
Ma ke ing s a egy, ma ke cha ac e is ics and po olio in es men s did no s a is ically
signi ican on expo pe o mance because hei p- alues we e g ea e han 0.05. Fi m
cha ac e is ics we e in e ela ed wi h echnical capabili ies. Ma ke ing s a egies we e
in e ela ed wi h ma ke cha ac e is ics and echnical capabili ies.
Table 4 Pea son Co ela ions
(Co ela ion is signi ican a ** p < 0.005, * p < 0.05)
The de eloped hypo heses we e es ed using he abo e Pea son co ela ions analysis.
Signi ican co ela ion wi h expo pe o mance o alue-added ubbe p oduc s in S i
Lanka among i m cha ac e is ics and echnical capabili ies we e iden i ied h ough abo e
analysis. Also, he e we e no any signi ican co ela ion be ween ma ke ing s a egy,
ma ke cha ac e is ics o in es men po olio.
Fi m
Cha ac
e is ics
Ma ke ing
S a egy
Ma ke
Cha ac e is ics
Technical
Capabili ies
In es men
Po olio
Ma ke ing
S a egy
0.208
Ma ke
Cha ac e is ics
-0.163
0.685**
Technical
Capabili ies
0.604**
0.473*
0.355
Po olio
In es men
0.033
0.224
0.251
Expo
Pe o mance
0.450*
0.192
0.108
0.626**
0.440
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786
To iden i y he mos impac ing ac o o expo pe o mance o alue-added ubbe
p oduc s s epwise eg ession analysis was ca ied ou as he e is mul iple-co ela ion
among independen a iables. The ou pu o ha analysis had been gi en in able 5.
Table 5 S epwise Reg ession Analysis
Va iable
F-Value
P >F
In e cep
0.24
0.6278
Technical
Capabili ies
11.57
0.0032
Acco ding o he abo e s epwise eg ession analysis, echnical capabili ies o S i
Lankan ubbe p oduc s manu ac u e s and expo e s was s a is ically signi ican o hei
ubbe p oduc s expo pe o mance.
Resul s and Discussion
Acco ding o he abo e s udy, echnological capabili y o he i m was iden i ied as
majo a ec ing ac o o he expo pe o mance o S i Lankan alue-added ubbe
p oduc s indus y. Fu he , posi i e co ela ion among i m cha ac e is ics and echnical
capabili ies is also iden i ied. Thus, S i Lankan alue-added ubbe p oduc s indus y can
imp o e hei ma ke pe o mance by ocusing he enhancemen o hose wo ac o s. This
inding is much aluable o S i Lankan alue-added ubbe p oduc s manu ac u ing
expo e s as he coun y was sea ching o be e expo pe o mance in he pa icula
ield.
As a de eloping coun y, S i Lankan ubbe p oduc s manu ac u e s need o use
app op ia e echnology in hei p oduc ion p ocesses. The managemen ’s a en ion should
be paid on upg ading he echnology when i is needed and no o in es in he mos ecen
echnology unnecessa ily which some imes leads o an addi ional expendi u e which will
ul ima ely be a was age. Acco ding o he analysis, majo i y i ms ha e gained mo e han
10% sales inc emen wi h echnological change. This can be done by doing ope a ional
changes in p oduc ion. Fu he mo e, i ms able o enhance hei echnological capabili ies
by ec ui ing skill ul employees who could abso b new echnical know-how in S i Lankan
alue-added ubbe p oduc s expo s.
Conclusions
S i Lankan alue-added ubbe p oduc s expo e s should be analy ical in o de o
imp o e hei expo pe o mance. The esea ch ound he mos impo an de e minan
ha he manu ac u e s need o ocus when making s a egic plans o inc ease hei expo
pe o mance was hei echnical capabili ies. Expo e s wi h app op ia e echnology will
lead o be e expo pe o mance in he alue-added ubbe p oduc expo ing indus y
in S i Lanka.
The esea ch had simula ed o many esea ch a eas such as o ge cus ome pe cep ion
o S i Lankan alue-added ubbe p oduc expo pe o mance and de elop a ubbe
p oduc expo pe o mance unc ion. The e we e se e al o he manu ac u ing and
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expo ing indus ies in S i Lanka. Those indus ies we e no conside ed unde his
esea ch and he e o e, hose indus ies could be coun o u he s udy and ob ain
common se o de e minan s ha a e impac ing on he pe o mance o he whole expo ing
sec o in S i Lanka.
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