Perceptions of the Barriers to Localization Before and During the Covid-19 Pandemic: “A Case of Turkish Machinery Manufacturers”

Abstract

Purpose: COVID-19 caused disruptions in international supply chains. Localization is one of the ways of dealing with this problem. Thus, this paper analyzes Turkish machinery manufacturing companies' perceptions regarding the barriers against localization pre and mid-COVID-19 to see whether the perceptions changed. In addition, the study applies Porter's Diamond Model as a framework to assess whether COVID-19 is perceived as a pressure to upgrade the industry's competitiveness. Design/Methodology/Approach: The research design of the study was determined as a case study. The reason for this is that the case study is an empirical research form that investigates a current phenomenon and real life in depth with a single or a few units. In this context, the sample of the study was determined as the member companies of Sakarya Machinery Manufacturers Association. In the interviews with these companies, open-ended questions were administered in order to reveal the perceptions of barriers to localization. The interviews were deciphered and open coded. Findings were obtained through qualitative content analysis. In the analysis process, which was handled in two stages, 47 producers before the pandemic and a smaller group of 32 people during the pandemic were evaluated. It was concluded that there are significant perceived barriers to the production and marketing of domestic substitutes. Findings: Marketing the substitutes of previously imported products are perceived more challenging than producing them. The perceived barriers slightly changed in mid-COVID-19 period. In addition, the sample underlines two more determinants in addition to the Diamond Model determinants: time and macroeceonomic stability. Originality/Value: This paper handles localization both as a solution to supply chain disruptions and an opportunity to increase the competitiveness of the industry. Insights in localization by evaluating the barriers perceived by the Turkish machinery manufacturing industry in a longitudinal manner (pre-mid COVID 19 period) will deepen the concept for further research, especially in developing world.

Keywords

• Domestic Substitutes
• Localization
• The Diamond Model
• COVID-19
• Machinery Industry
• Manufacturing

Perceptions of the Barriers to Localization Before and During the Covid-19 Pandemic: “A Case of Turkish Machinery Manufacturers”

Abstract

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