Customer Related Risks : A Garment Manufacturer Perspective

Abstract: This paper examines risks that arise from buyer-manufacturer relationships from Malaysian garment manufacturers' perspectives. In addition, the risk management techniques used to handle these risks are studied and cross-examined. The nature of the relationship is also discussed in relation to the risks and risk management techniques identified. Design/methodology/approach: This thesis is based on a deductive research approach. Two research questions are answered with the help of six semi-structured in-depth interviews with managers at Malaysian garment factories and a thematic analysis. Findings: The most significant risk associated with the relationship is late payments. The most common risk management technique to minimize this risk is to demand deposits before production starts. The nature of the relationship between the manufacturer and their customers plays a substantial role in the types of risks faced by manufacturers and their use of risk management techniques. Research implications: The managerial implications are that garment manufacturers can learn from other manufacturers’ risks and risk management techniques to improve their own business and act proactively. The research question of this report sheds light on the hidden field of the effects of purchasing practitioners' decision-making and can inspire future research. Originality/value: This study explores a topic from a perspective that has not been studied before. The research role, given that we are young students, has offered unfiltered and unique data which gives the results high value.