The Determinants of Firm’s Competitiveness in the Textile and Apparel Industry in Tanzania

Abstract

This study explores the determinants of firm’s competitiveness in the Textile and Apparel Industry in Tanzania. Data were collected from 204 respondents through cross-section survey design and non-probability sampling method from three regions; namely, Dar es salaam, Mwanza and Arusha. The Maximum Likelihood technique was used to estimate the Structural Equation Modelling (SEM) in order to compute the fit indices of both measurement and structural models. In doing so, Factor Analysis was used in the preliminary step before estimating SEM in order to filter out key variables that need to be embedded in gauging competitiveness of the textiles and apparel industry. Thereafter, the principle component analysis (PCA) was used to extract the relevant constructs in the SEM. The estimated results show that value chain management, core competencies, competition, availability of alternative products and barriers to entry are statistically significant constructs in explaining the competitiveness of firms operating in the textile and apparel industry in Tanzania.

Keywords: Firms, Competitiveness, Textile and Apparel Industry, Maximum Likelihood, Structural Equation modeling, Factor Analysis, Tanzania