Relationship between routines of supplier selection and evaluation, risk perception and propensity to form buyer–supplier partnerships

Abstract

Supply chain partnership is viewed as an important contributor to superior competitiveness, yet the knowledge of ex-ante factors contributing to the deployment of supply chain partnership is nascent. This paper examines the influence of the current supplier selection routines, supplier evaluation routines, and managerial attitude towards relational and performance risks on the future intention to form buyer–supplier partnerships, based on relational and evolutionary economics theory. The analysis is based on 156 questionnaires received from senior executives and supply/logistics managers of UK firms. We found that partner selection routine positively influences firms’ propensity (future intention) to form buyer–supplier partnerships, unlike the supplier evaluation routine and perceptions of both relational risk and performance risk, which were not found to have a significant role. Our findings suggest that firms wishing to initiate buyer–supplier partnerships can increase the likelihood of doing so by ensuring that their supplier selection routines incorporate efforts to establish potential suppliers’ inclination for openness in a relationship, to establish their track record of demonstrating a high degree of integrity with other buyers, and to confirm that potential suppliers have a deep knowledge and understanding of the buyer’s business, a recognized strong reputation, and demonstrable financial stability.