Maintaining Buyer‐Supplier Partnerships

Abstract

Partnerships between industrial buyers and industrial sellers are becoming more common in the United States. However, evidence suggests that many of these relationships do not reach their full potential because of actions taken or not taken by the partners. While some partnerships are doomed to failure from the beginning, many fail because the partners do not have a process established to maintain the relationship. This article offers a model for developing and maintaining buyer‐supplier partnerships. The development portion of the model consists of four stages: (1) buyer's expectations, (2) seller's perceptions, (3) mutual understanding and commitment, and (4) performance activity. However, certain problems in the performance activity stage can place the relationship in jeopardy and move the partnership to another stage: (5) corrective action. The model continues by illustrating three approaches to mitigate these performance problems and bring stability back to the relationship: (1) operational unilateral adjustment, (2) operational bilateral adjustment, and (3) managerial bilateral adjustment. The key to a stable, mutually beneficial buyer‐supplier partnership over time is understanding how problems may enter a relationship and how they can best be eliminated.

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