The effectiveness of market orientation in the logistic industry: A focus on SMEs in an emerging country

Although the interrelationship between market orientation, innovation, and performance has been intensively examined in the literature, there is a lack of understanding of this in the contexts of small and medium enterprises (SMEs) operating in Vietnamese logistic industry. Thus, this study aims to draw upon the resource-based view to examine the mediating effects of incremental and radical innovation on the link between market orientation and organizational performance. Data collected from 153 logistic SMEs in Vietnam were used to assess the proposed model. Partial least square structural equation modelling was used to examine data. The results suggest that incremental and radical innovation partially mediate the link between market orientation and organizational performance. In this regard, this study contributes to logistic literature by showing the antecedents and consequences of innovation. In addition, this study contributes to market orientation literature by assessing the consequences of market orientation in Vietnam. This study also contributes to the refinement of resource-based view. Finally, this study also provides practical implications for managers manage logistic SMEs in Vietnam.