The method to assess the efficient interaction between a company and suppliers on relationship marketing basis

Abstract

The importance of the research is determined by the necessity to develop methodologically substantiated tools for the assessment of efficient interaction between a company and suppliers to implement timely adjustments of the current activities of interaction with suppliers, providing an increase in the level of customer satisfaction and improvement of the company’s performance. The purpose of this article is to develop and test a comprehensive methodology for assessing the efficiency of a company’s interaction with suppliers based on relationship marketing. To achieve the purpose of the study we have used the methods of system approach, comparative analysis, synthesis, economic modeling, empirical, expert-analytical and statistic methods of economic analysis. The article characterizes currently widespread marketing concepts – conventional marketing and relationship marketing. The current approaches to the assessment of efficient interaction between partners have been analyzed. It is noted that in scientific literature the greatest emphasis is paid to the relationships with customers, while relations with suppliers are not widely discussed. The four-staged author’s methodology for assessing the efficiency of a trading company’s relationship with suppliers is presented. It allows us statistically and dynamically to make a comprehensive and systematic assessment of the effectiveness of a trading company’s relationship with suppliers using the system of both quantitative and qualitative indicators that consider economic, sociological and strategic aspects of cooperation. It takes into account the economic, sociological and strategic aspects of cooperation. The assessment of suppliers according to economic indicators, evaluation of suppliers according to sales dynamics, and the assessment of the level of relationship with suppliers are the criteria for the assessment of efficient relationship with a company’s suppliers in the original methodology suggested by the author. According to the estimates suppliers’ rate is made: the rating of the economic importance of suppliers, rating of suppliers’ perspectivity, the rating the level of relationship with suppliers, the final rating of the efficiency of the interaction with suppliers. The final stage of the methodology application suggests the classification of suppliers into five categories – key, strategic, promising; standard and unpromising suppliers, the formation of a portfolio of suppliers and the formation of a strategy for the development of cooperation with each of them in future. The methodology has been verified in the case study of a Russian trade company Zooland Ltd. operating in the pet products market. The research results are considered to be valuable for further development of methodological and methodical foundations of the concept of relationship marketing, and can also be used by trading companies in various fields of activity, that consider the modification depending on the characteristics of the industry.

Keywords

relationship marketing, transactional marketing, value chain, assessment of relationship efficiency, partner’s portfolio, supplier’s portfolio, company performance, strategy, company resources

For citation

Ilyenkova K.M. The method to assess the efficient interaction between a company and suppliers on relationship marketing basis. Perm University Herald. Economy, 2019, vol. 14, no. 4, pp. 637–659. DOI 10.17072/1994-9960-2019-4-637-659

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