Buyer Supplier

Relationship

Important factors of
buyer-supplier
relationship
Cost reduction : Cost reduction and process streamlining

Innovation & Development: Importance for coherent R&D

Interdependence: Buyer Supplier relationship is like a

wedded relationship

Trust: For longstanding relationship building trust is

important

Quality: Companies shown interest towards suppliers with

high quality products

Satisfaction: Overall satisfaction of relationship against

various scale like payment, growth of revenue and
volume, commitment

Information Exchange: Companies prefer suppliers with

transparent information handling suppliers

Major Differences Between

Companies Presented

Toyota Building long-lasting relationship with the help of keiretsu,

mutually satisfied.

General Motors Armed length negotiations with primary aim to

reduce costs, strained relationship, supplier dissatisfaction

Microsoft Hegemony & monopoly, try to control the growth of

competitor with its muscle power

Hong kong container terminal Market coverage by reducing the

prices, just a formal relationship

Hollywood motion picture industry Relationship is project based.

Short term commitment based on individual projects

Prato wool textile industry To and fro relations and information

sharing with suppliers to maintain design creativity & market trend

Airbus Outsourcing in multiple partners and strict adherence to

quality standards, performance driven

Acer Major of the parts are outsourced on contractual basis

Best approach towards

buyer supplier
Approach adopted
by Toyota is considered to be one of the best
relationship
approach in handling suppliers

Toyota enjoying minority stake in supplier companies and enable

job transfer of employees with Keiretsu will help Toyota to strictly
control on cost and quality fronts. Supplier Support center (for
suppliers to learn core concepts of Toyota production)

Mutual friendship and progressive information sharing will help

Toyota to built long standing trust & relationship with its suppliers
(Supplier Association-1943)

Suppliers are purposefully located in around the Toyota facilities to

cut cost and enhance frequent face to face meeting

Main pre-requisites Quality, Reliability & commitment to cost

reduction

Future Of Buyer Supplier

Increased Emphasis
on SCM to Optimize operations hence saving cost
Relationship

Increase mutual sharing of knowledge and information to cut inventory and save
cost

Increased dependability on online transactions, purchases and sales by

developing fool proof online platform

Outsourcing in Manufacturing and Service sectors

Focus to build long standing relationship with global partners which can save
cost

Increase use of SCM

Increase use of online communication in purchasing
Increase outsourcing in manufacturing & servicing factors
Profit/ quality pressures on companies
Desired to minimize inventory
Increase globalization & competition

Globalisation and foreign outsourcing responsible for profit pressure.

Profit and sustainability pressure casing companies to rethink over the BuyerSupplier Relationships.