The Effect of Product Quality Toward The Relationship Between Green Purchasing Behavior and Firm Performance

This study analyzes the relationship between the green purchasing behaviours, product quality and financial performance of plastic industry. A company’s green purchasing behaviours can be measured by four independence variables; i) identified as environmental concern, ii) environmental attitudes, iii) social influence and iv) company image. A product quality functions as moderator in this study. The objectives of this study are: 1) to determine the relationship between green purchasing behaviours and company financial performance, 2) to investigate the relationship between green purchasing behaviours, product quality and company financial performance and 3) to describe the relationship between green purchasing behaviours, product quality and company financial performance. Three relationships posited and tested. A survey design and correlation research investigation was conducted and carried out through clustered sampling on plastic company serving one of the plastic moulding companies. Seven plastic manufacturing companies were selected as respondents. The data were analyzed by utilizing Rasch measurement model. The analysis process starts by goodness of measures followed by descriptive analysis on the variables that have been understudied. It has resulted that the plastic companies’ green purchasing behaviours and its product quality significantly correlated with their financial performances. In order to continue to excel, plastic industries should re-strategize to improve their solutions coverage and to invest in green products research and development.