Functions of Industrial Supplier Relationships and Their Impact on Relationship Quality

Department of International Economics and Management, Copenhagen Business School, Howitzvej 60, DK-2000 Frederiksberg, Denmark
Industrial Marketing Management (Impact Factor: 1.93). 02/2003; 32(2):159-169. DOI: 10.1016/S0019-8501(02)00230-4


Although recent scholarly work on business relationships often discusses relationship quality as a major issue, especially with regard to the phenomenon of vendor stratification, there is still little empirical research on this important construct. In this paper, the authors provide a thorough conceptualization of relationship quality and its possible antecedents, i.e., the direct and indirect functions of the relationship for the customer. Drawing on an empirical base of 230 buyer questionnaires, the authors show that the extent to which a supplier fulfills direct and indirect functions in a relationship has a direct positive impact on the relationship quality perceived by the customer. This impact is especially strong when the customer can easily replace the supplier or, in other words, when the supplier faces competition. The findings are discussed and the authors provide managerial implications for decision-makers from both buyer and supplier organizations.

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    • "The decision of whether to confer this status is influenced by the attractiveness of the buyer (Hüttinger et al., 2012) and stems from the reasoning that the supplier has the choice to assign its customer either regular or preferred status (Baxter, 2012b). After awarding preferred status, the perceived relationship quality often increases which, in turn, motivates the supplier to offer additional functions to the customer and further commits itself to the relationship (Baxter, 2012a; Ellegaard et al., 2003; Schiele et al., 2011; Walter et al., 2003). Therefore, being an " interesting " customer is presumed to ensure the loyalty of the supplier and facilitate open innovation (Christiansen and Maltz, 2002). "
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    ABSTRACT: New product development occurs nowadays mostly in joint buyer–supplier projects, which require closer ties between the partners in order to mobilize their resources. One issue arising from this collaborative model is that the buyer tends to become more dependent on the supplier. Multiple cases of supplier obstructionism have been reported. To mitigate this dilemma, this paper analyzes the relevance of customer attractiveness as an enabler of collaboration. Testing this hypothesis on a sample of 218 buyer–supplier relationships, we show that dependency as such is not the issue in the presence of close ties. Buyers who are a preferred customer of their suppliers can accept the risk of becoming dependent on them. The managerial implications of this finding is that firms should apply a reverse marketing approach and thus attempt to become the preferred customers of their important suppliers. From a conceptual perspective, our findings indicate the need to consider dependency not as an isolated variable, but in conjunction with attractiveness.
    Australasian Marketing Journal (AMJ) 05/2015; 23(2). DOI:10.1016/j.ausmj.2015.04.009
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    • "Although customer satisfaction has already been recognised as relevant to business success for decades (see e.g. Anderson and Narus, 1990; Cannon and Perreault, 1999; Dwyer et al., 1987; Siguaw et al., 1998; Walter et al., 2003), supplier satisfaction has remained largely unexplored. However, supplier satisfaction may well be a prerequisite to accessing supplier resources. "
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    ABSTRACT: Recently, supplier satisfaction has gained more attention both in practice and in academic research. However, the knowledge accumulation process is still in an embryonic and explorative phase. Likewise, supplier satisfaction measuring in practice may still benefit from an impetus from academia to be more widely used. This paper aims at considerably expanding understanding of supplier satisfaction by proposing to apply a social capital and a resource dependence theory perspective. We expect an abundance of social capital in a relationship to relate positively to supplier satisfaction, whilst power disequilibrium and dependence from the buyer are expected to negatively relate to supplier satisfaction. It is worth highlighting that, according to research rooted in Hofstede's cultural dimensions model, the perception and acceptance of power differences resulting from a situation of dependency is highly culture specific. We therefore further hypothesise that supplier satisfaction will be moderated by cultural differences and ask researchers to take the cultural dimension into account.
    Australasian Marketing Journal (AMJ) 05/2015; 23(2). DOI:10.1016/j.ausmj.2015.04.008
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    • "The concept of relationship quality has been largely attracting several research attentions as an important mechanism which probes to explain the critical features of the relationship between a brand and its potential customers (Qin, Zhao, & Yi, 2009; Walter, Muller, Helfert, & Ritter, 2003). Brand relationship quality was defined by Algesheimer, Dholakia, & Herrmann (2005) as the extent to which customers think of a brand as a satisfactory partner in a long-lasting relationship; it reflects consumer's overall evaluation toward the strength of the relationship established with a brand. "
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    ABSTRACT: This study examines the effect of product innovation on relationship quality in automotive industry. Based on the review of literature, it is evident that there are very limited studies which have come across the effect of product innovation on relationship quality and its dimensions; brand satisfaction, brand trust, and brand commitment. Therefore, this study aims to contribute to the literature and body of knowledge on the actual relationship between such variables. The automotive sector in Malaysia was selected to conduct this study whereby the data were collected from passenger car users in Northern region of the country. The data were analyzed using SPSS and structural equation modeling (AMOS). The findings revealed that the research model fits the data significantly and achieved the recommended values for all fit indices. In particular, the findings supported the significant positive effect of brand satisfaction on brand trust. Consequently, brand trust has significant positive effect on brand commitment. Moreover, the findings indicated that product innovation has significant positive effect on relationship quality and its dimensions; brand trust, brand commitment, and brand satisfaction. The findings also demonstrated that the main contribution of this study lies in the examination of product innovation as an antecedent to relationship quality and its dimensions rather than looking on the frequently used antecedents. These results and their implications along with avenues for further research are also elaborated in this study. © 2015, Canadian Center of Science and Education. All Rights Reserved.
    Asian Social Science 03/2015; 11(10). DOI:10.5539/ass.v11n10p94
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