What drives unorganised supply chains? A structural analysis of small retailers' performance drivers

Purpose This study aims to investigate the hierarchical interrelationships among the financial, technological and operational factors that influence the performance of unorganised retail supply chain (URSC). An empirically validated, hierarchically structured framework was developed to identify the foundational drivers of URSC performance and their interrelationships. Design/methodology/approach This study adopts a mixed-methods research design. Principal component analysis was used to reduce the 40 contextual factors into 7 constructs. These constructs formed a conceptual model which was tested using structural equation modelling to quantify causal linkages. Additionally, interpretive structural modelling (ISM) was applied, integrating expert insights to establish the hierarchical priorities among the performance drivers and their interrelationships in URSC. Findings The results show that out of seven constructs, technology adoption, access to credit and inventory management exert a positive influence on URSC performance. The primary contribution of this study is the elucidation of hierarchical relationships through the ISM. The obtained hierarchy identifies access to credit or financial resources as the foundational driver that directly influences the feasibility of technology adoption. This hierarchy illustrates how essential financial resources facilitate technological capabilities, ultimately leading to operational efficiency and responsiveness as the final systemic outcomes of the URSC. Practical implications For retailers, this study highlights the imperative of partnering with fintech firms for credit lines and accelerating the adoption of customised, low-cost technological solutions (e.g. barcode readers and mobile bookkeeping apps). Policymakers should facilitate subsidised credit access and provide suitable training programmes for small retailers to bridge technology adoption gaps, enabling unorganised players to effectively combat competition from the organised sector. Originality/value This study presents an empirically validated, hierarchically structured framework for understanding URSC performance drivers and their interrelationships. This delineates a clear roadmap for strategic interventions and policy formulation, thereby contributing to the understanding of the URSC in India and how their performance can be improved.