Buyer - Supplier Relationship

Buyer - Supplier Relationships

Characterize the different types of buyer - supplier relationship described in the case.

Trust/ Reliability

Quality

High level of Commitment

Mutual Friendship

Satisfaction

Innovation & Development

Information Exchange

Interdependence

Social Support

Cost Reduction

2. How and why do they differ from each other ?

Toyota- Corporation

The parent firm has a minority ownership in each companies, and would transfer employees to it.

Toyota valued face-to-face contact in fostering supplier relationships.

Toyota appeared to do business only with suppliers that could provide global presence, technical innovation and speed.

General Motors- Armed length negotiation with primary aim to reduce cost

GM had a relationship with suppliers that some would consider “adversarial”.

It also broke the tradition of renewing one-year contracts with long-term vendors, instead often switching the business to the lowest bidder.

They do not believe in old tradition of bear hugs, talking and love. But believe in partnership based on market demands and customer expectations.

Having relationship with suppliers with very high expectations, sharing global opportunities and volume forecasts.

Microsoft- Hegemony & Monopoly

Microsoft expanded its market in video game consoles, enterprise, software, etc.

Microsoft used a variety of tactics to deter PC- market.

They used licensing agreements and technical integration to make sure that PC- marker and other partners had little choice, but to use IE in their products.

Microsoft terminated negotiations with IBM to licence upcoming Windows.

They sent Compaq a letter stating its intention to terminate Compaq’s license for Windows 95.

Hong Kong Container Terminal- Market coverage by reducing the prices

Hong Kong handled a large chunk