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HOW CAN COMPANIES BUILD STRONG CUSTOMER RELATIONSHIPS
CLOSER RELATIONSHIS ARE DRIVEN BY SUPPLY CHAIN MANAGEMENT, EARLY SUPPLY INVOLVEMENT AND PURCHASING ALLIANCES
BENEFITS OF VERTICAL COORDINATION
ENGAGINNG IN VERTICAL COORDINATION B/W BUYERS AND SELLERS CREATES VALUE FOR BOTHMARKETING INSIGHT:ESTABLISH COPORATE TRUST, CREDIBILITY& REPUTATION
TYPES OF BYER SUPPLIER RELATIONSHIPS:
BASIC BUYING AND SELLING
SIMPLE ROUTINE CHANGES WITH MODERATE LEVEL OF COORDINATION
BARE BONES
MORE ADAPTATION BY THE SELLER AND LESS COORDINATION BY THE BUYER
CONTRACTUAL TRANSACTION
FROMAL CONTRACTS WUITH LOW LEVEL OF TRUST
CUTOMER SUPPLY
COMPETITIONRATHER THAN COOPERATION IS THE FORM OF
GOVERNANCE
COOPERATIVE SYSTEMS
UNITED IN OPERATIONAL WAYS BUT NEVER DEMONSTRATE STRUCTURAL
COMMITMENT THROUGH LEGAL MEANS
COLLABORATIVE
TRUST AND COMMITMENT LEAD TO TRUE PARTNERSHIP
MUTUALLY ADAPTIVE
BUYERS AND SELLERS MAKE RELATIONSHIP SPECIFIC ADAPTATIONS
CUSTOMER IS THE KING
SELLER ADAPTS TO MEET THE CUSTOMER’S NEED WITHOUT EXPECTING MUCH ADAPTATION IN RETURN
Business risk and opportunism
Establishing a customer supplied relationship creates tension between safeguarding and adaptation
SPECIFIC INVESTMENTS ARE THOSE TAILORED TO A PARTICULAR COMPANY AND VALUE CHAIN PARTNERA CONSIDERABLE RISK TO BOTH PARTIESTRANSACTION THEORY STATES THAT AS THE INVESTMENT IS SUNK , BOTH PARTIES ARE LOCKED IN THE RELATIONSHIP
BUYER IS VULNERABLE CAUSE OF SWITCHING COSTSSELLER IS VULNERABLE DUE TO DEDICATED ASSET KNOWLEDGEHENCE AT TIMES OPPURTUNISM SNEAKS INIT IS SOME FORM OF UNDERSUPPLY OR CHEATING IMPLICIT OR EXPLICIT TO CONTRACT
BENEFITS OF VERTICAL COORDINATION
TYPES OF BYER SUPPLIER RELATIONSHIPS
BUSINESS RISK AND OPPORTUNISM
RISK MANAGEMENT
SUMMARY
THANK YOU
BY YATIN ARORAB.TECH STUDENT DELHI TECHNOLOGICAL UNIVERSITY