Coordination of different business activities among units becomes vital as organizations pay much attention to their core activities. Thus, their fruitfulness constantly relies on their capacity to coordinate their internal and external activities in the supply chain outside their own boundaries. Giving consideration to these obvious reasons, this paper aims to investigate the determinants of supply chain coordination of milk and dairy industries. The data were collected from 330 milk suppliers, processors, and retailers in the central part of Ethiopia. The structural equation modeling has been employed to develop the structural relationship between key constructs and measured variables. In total, 15 measured variables for coordination in the supply chain have been identified. These are further grouped into four factors namely, non-price coordination, price coordination, relationships and product development decision. It has been observed that the implementation of these factors could maximize the coordination linkage among supply chain members. Thus, dairy sectors should take the identified coordination factors into account in each of their business dealings.
Keywords: Coordination; Ethiopian dairy industries; Structural equation modeling; Supply chain management.