From Supply Chain Frictions to Financial Resilience: Evidence from an Emerging Economy

Abstract

Supply chains are often seen as a strategic system to boost profitability rather than a cost center, especially in developing countries with problems in logistics, working capital constraints, and frequent market disruptions. This study tests whether supply chain performance proxies capture the profitability of publicly traded cement firms in Bangladesh for the period 2015-2024. The study covers 54 firm-year observations for the years 2016-2024. FGLS model is used as the main estimator, while PCSE and robust OLS are used for validation and to adjust for diagnostic issues. Results show that all lagged proxies of the supply chain have a substantial effect on profitability, indicating that adequate management of receivables, inventory, payables, and working capital can greatly enhance profitability in firms operating within an emerging economy. By situating these results within established theoretical paradigms and rigorous econometric analysis, this study delivers pragmatic guidance for bolstering enduring financial resilience via systematic supply-chain finance strategies.