||The competitive environment has changed the relationships between manufacturing firms and their suppliers toward a working entity that needs to be fully integrated in order to compete in the fast changing environment. Therefore, supply chain management practices have a positive impact on competitive advantage. The members must have close cooperation relationship because the supply chain consisting of many different business entities. Then, the members along the supply chain have the consciousness of mutual benefit and mutual dependence and prove integrated competitive advantage. Therefore, the key of the supply management success is supply chain relationship quality.
The research subjects of this study are the manufacturing firms in Taiwan, and the data collected are tested by using structural equation model. According to the results of the analysis, the study found that supply chain management practices and supply chain relationship quality have a positive impact on competitive advantage. In other words, the business can strengthen competitive advantage through improving supply chain management practices and supply chain relationship quality. This study suggests two directions as follows: the practices about supply chain management practices ranked in terms of their factor loading are as follows: (1) information sharing, (2) problem solving and improvement, (3) objective setting and new product development, (4) the establishment of information system, (5) supplier selection; the practices about supply chain relationship quality ranked in terms of their factor loading are as follows: (1) trust, (2) communication and information sharing, (3) adaptation, (4) cooperation, (5) commitment, (6) interdependence. Besides, the businesses could review by themselves and strengthen the supply chain management practices and relationship quality to create their sustaining competitive advantage.