The innovative performance and operational performance, which are considered as vital dimensions of a firm’s performance, have not been addressed sufficiently in the literature of supply chain quality management (SCQM). Additionally, limited studies have explored SCQM capabilities and knowledge transfer (KT) as crucial drivers for SCQM. The aim of this research is to develop a theoretical foundation for the nexus of SCQM practices, SCQM capabilities, knowledge transfer (KT) and a firm’s performance; besides providing a complete review of the literature on the interdependent association of SCQM practices, SCQM capabilities and KT concerning firm performance (i.e. operational and innovative performance). This study provides insights for improving the firm performance by exploring the nexus between SCQM practice, SCQM capabilities and KT. In doing so, this research adds in the understanding of critical features of supply chain management after involving effective integration which has not been broadly explored before.