Life cycle models buyer -supplier relationship

madugundurukmini By madugundurukmini, 21st Aug 2014 | Follow this author | RSS Feed | Short URL http://nut.bz/29z0oaxp/
Posted in Wikinut>Business>Selling A Business

The supplier -buyer relationships rest on trusts. Sako, who defines trusts as `a state of mind, an expectation held by one trading partner about another that the other behaves or response in a predictable and mutually acceptable manner'.

Both partners can perform their role competently

Suggests, based on an investigation into inter -firm relationships in Britain and Japan, that there are three types of trusts, namely;
A. Contractual trust -both parties keep their promises
B. Competence trust- both partners can perform their role competently
C. Goodwill trust- mutual expectation of open commitment to each other or the willingness to do more than is expected.

The evolution and development of buyer relationship over time

Life cycle models buyer -supplier relationship
Attempts have been made to develop a model of the evolution and development of buyer relationship over time. Two such models, one developed by David Ford and the other by Dwyer, Schurr and Oh are summarized in a table.

According to the model of Dwyer et al., the relationship is brought to a close in the last phase. The final stage in the Ford model represents the relationship in its most developed form. For example, one cannot rule out the possibility of even such a relationship coming to an end later. If there is such a drastic change in the technology that the supplier's product is no more required by the buyer, or the buyer or seller finds a substantially better alternative, the partnering should end.

Model Ford, Commitment stage

Stages of buyer -seller relationship
1. Pre -relationship stage :model of Ford, Awareness stage – model of dwyer, schurr and Oh
2. Early -relationship- :model of Ford, Exploration - model of dwyer, schurr and Oh
3. development stage- :model of Ford, Expansion - model of dwyer, schurr and Oh
4. Long -term stage - :model Ford, Commitment stage - model of dwyer, schurr and Oh
5. Final stage- :model Ford, Dissolution stage - model of dwyer, schurr and Oh

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