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Power in distribution channels: Supplier assortment strategy for balancing power
Linköping University, Department of Management and Engineering, Industrial Economics. Linköping University, Faculty of Science & Engineering.
Linköping University, Department of Management and Engineering, Industrial Economics. Linköping University, Faculty of Science & Engineering.
Linköping University, Department of Management and Engineering, Industrial Economics. Linköping University, Faculty of Science & Engineering.
Operations and Information Management Group, Aston Business School, UK.
2016 (English)In: Industrial Marketing Management, ISSN 0019-8501, E-ISSN 1873-2062, Vol. 54, 176-187 p.Article in journal (Refereed) Published
Abstract [en]

This paper focuses on the move from buyer dominance toward interdependence between buyers and suppliers in a distribution channel. The paper introduces a case study collected through in-depth interviews and participative observations. It examines the relationships between a timber supplier and its customers in the builders’ merchants sector. We stress the relevance of considering actions intended to change the power balance, rather than focusing only on trust. The power balance in a dyadic relationship is dynamic, and power positions need to be constantly re-evaluated. An important power resource is information asymmetry, manifested in the supplier’s information about: products, regional and local demand, and the usage of the products. For practitioners, we highlight the possibility of exerting a non-coercive power resource, such as information asymmetry, in order to increase the relative power. Furthermore, being open about the power position between a buyer and a seller can foster a more efficient collaboration.

Place, publisher, year, edition, pages
Elsevier, 2016. Vol. 54, 176-187 p.
Keyword [en]
Power, Distribution channels, Information asymmetry, Resource dependence, Supplier–retailer relationships, Assortment, Power regimes
National Category
Other Mechanical Engineering Business Administration
Identifiers
URN: urn:nbn:se:liu:diva-121505DOI: 10.1016/j.indmarman.2015.07.007ISI: 000375165800017OAI: oai:DiVA.org:liu-121505DiVA: diva2:856009
Available from: 2015-09-23 Created: 2015-09-23 Last updated: 2017-12-01Bibliographically approved
In thesis
1. Supplier Integration in Category Management: A case study of the situational impact on relationship performance and interdependence
Open this publication in new window or tab >>Supplier Integration in Category Management: A case study of the situational impact on relationship performance and interdependence
2015 (English)Doctoral thesis, comprehensive summary (Other academic)
Abstract [en]

Supplier integration in category management means that a supplier takes part in the activities that are traditionally performed by retailers. These activities are the selection of which products to sell, decisions on how to price and market the products, and making sure that the products are delivered to the stores in a timely manner. Depending on the situation, an integration of suppliers in these activities can be more or less suitable.

As more research is needed to understand when supplier integration in category management is suitable, the purpose of this thesis is to describe and analyze how situational factors affect the relationship consequences of supplier integration in category management. Specifically, the relationship consequences are expressed in terms of relationship performance and interdependence between the firms.

The study builds on empirical data about British and Swedish builders’ merchants and their suppliers, with a particular focus on timber suppliers. Data has mainly been collected through participative observations and interviews.

Five situational factors that improve the relationship performance of supplier integration in category management are identified: large retailer firms, supplier product knowledge, homogeneity of market demands for the supplier’s products, mutual trust and a shared view on customer value between the supplier and retailer. Three situational factors are identified that affect the interdependence between the retailer and the supplier when supplier integration in category management is implemented: supplier product knowledge, whether the supplier or the retailer initiates the integration and whether coercive or non-coercive power has to be used in the implementation.

This thesis contributes to retail literature by highlighting the need to include situational factors in the analysis of supplier integration, clarifying which activities are comprised by category management and suggesting a theoretical foundation based on the resource-based view and the transaction cost framework to analyse relationship performance in retailer-supplier dyads. When making decisions on integration, managers of retailers and their suppliers are advised to consider the fit with their overall strategy, the fit with the surrounding situation and the effects both in terms of interdependence and relationship performance.

Place, publisher, year, edition, pages
Linköping: Linköping University Electronic Press, 2015. 118 p.
Series
Linköping Studies in Science and Technology. Dissertations, ISSN 0345-7524 ; 1705
Keyword
Supplier integration, category management, interorganizational relationships, retail
National Category
Business Administration
Identifiers
urn:nbn:se:liu:diva-121511 (URN)10.3384/diss.diva-121511 (DOI)978-91-7685-943-8 (ISBN)
Public defence
2015-11-06, A1, A-huset, Campus Valla, Linköping, 13:15 (English)
Opponent
Supervisors
Available from: 2015-09-23 Created: 2015-09-23 Last updated: 2015-11-19Bibliographically approved

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Rehme, JakobNordigården, DanielEllström, Daniel

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