Business-to-business relationships: assessing the value of buyer-seller cooperation in the New Zealand environment

Abstract

Today's business climate encourages firms to not just compete on product or service attributes, but also on their ability to differentiate themselves from other firms. Supply chains provide firms this point of differentiation ensuring firms better competitive positioning as a result of being able to leverage themselves on the strengths of the supply chain, not just on the individual strengths of the firm. However, to maintain an effective role as a participant in a supply chain, firms must be able to develop and maintain cooperative relationships with other firms. In order to develop these relationships, firms need to be able to distinguish between different levels of relationship and be able to understand which relationships are worth developing further and which ones are not.

Although various literatures confirm the importance of effective inter-firm relationships, less is known of how firms determine which relationships are worth developing for both buyers and sellers. This research proposes and investigates a theory of how buyers and selIers value cooperative business relationships across a range of relationships types. The model was tested using empirical data gathered from the food manufacturing and food distributor industries. Face-to-face interviews were used to gather the data, employing a variety of measurement techniques. Appropriate measurement scales were developed to test the research model. Hypotheses were tested with discriminate analyses and one-way ANOVA's. Limitations of the project were presented and discussed.

Twenty-two of the twenty six hypotheses were supported by the analysis. Several of the hypotheses point towards potential improvement in how businesses manage relationships. The results indicate differences between buyers and sellers with regard to relationships. All four relationship levels were confirmed by the buyer, however only three out of the four were confirmed for the seller.

Whilst this research makes several unique contributions to theory, including the development of new relational and value continuums, further research opportunities remain. These include examining the impact of relationship values at the same level of relationship in dyadic context, and further testing of the model in other non-related industries.