Business Relationship Case Study

This case study examines business relationships of a large window and door distributor in the northeastern United States with two suppliers; a “special” partnership and a “typical” transactional vendor. The partnership supplier has played a dominant role in supplying products to the distributor for many decades. This unique relationship with a company much larger than the distributor has recently evolved further through an exclusive territory arrangement and is now generally considered a strategic alliance. Dependence, relationship investment, and switching costs are viewed as important relationship attributes by the distributor in this relationship. Information exchange and trust have been increasing in this alliance although the distributor feels threatened by the leverage of this very large supplier. The typical business relationship of the supplier discussed in this case can be characterized as having low strategic importance to the distributor. Dependence, relationship investment, and switching costs for the distributor are viewed as low and information exchange is virtually non-existent. These two types of supplier relationships are examined in terms of the steps leading to relationship development, the shared activities, and the implementation and evaluation of these processes.

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