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Keywords:

  • supply chain management;
  • firm performance;
  • cost management;
  • ratio analysis;
  • resource-based view;
  • resource-advantage theory

Research has shown that superior supply chain effectiveness can yield enhanced firm financial performance. However, existing research does not use a consistent definition or a comprehensive list of supply chain leader firms. Using matched sample comparison, this study investigates the robustness of the relationship between supply chain effectiveness and the overall financial health of firms viewed as supply chain leaders by using AMR's supply chain top 25 list. We hypothesize that firms that have been identified by AMR as supply chain leaders will be more financially healthy than nonsupply chain leaders. That is, they will have better cost, activity, and liquidity ratios. The findings indicate that firms identified as supply chain leaders outperform their nonsupply chain leader peers in accounting-based activity, cost, and liquidity measures.