[go: up one dir, main page]
Scribd
Upload
86 views2 pages

Supplier Relationships and Socialization Impact

The document discusses a conversation between Robert Handfield and Ken Rawson about receiving gifts from suppliers and how socialization can influence business relationships. While socialization provides advantages like stronger emergency support, Ken believes it should not influence buying decisions and suppliers should disclose costs transparently rather than relying on personal connections.

Uploaded by

Mary Cherill Umali
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
86 views2 pages

Supplier Relationships and Socialization Impact

The document discusses a conversation between Robert Handfield and Ken Rawson about receiving gifts from suppliers and how socialization can influence business relationships. While socialization provides advantages like stronger emergency support, Ken believes it should not influence buying decisions and suppliers should disclose costs transparently rather than relying on personal connections.

Uploaded by

Mary Cherill Umali
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd

INTRODUCTION

Case Background
Robert Handfield had the opportunity to meet with a group of supply chain
professionals at the University of Calgary. This is where he met Ken Rawson who had
worked in the supply management for over 30 years, initially with CP Railroads and
later with Suncor Energy. During the meeting, Ken brought up the point about how
receiving gifts from suppliers can quash relationships.
Ken recalled from a conversation he had with field technicians that taking
everything given to him means he has nothing to hide from the suppliers. He insisted
that suppliers are prompt to attract buyers to social gatherings but the main concern
emanates on how the board view the activity if they are not expecting anything in
return since it may cost a huge amount in funding such event and gifts. As
socialization is considered indispensable in the buyer-seller relationships, the question
of whether it influences a buyer's decision arises.
On the other hand, socialization has some advantages. For Ken, if the seller is
nearby, they may be more likely to go out of their way to help you as a customer if
there is an emergency. Aside from price, there are always a plethora of other factors to
consider such as the conditions. However, he stated that suppliers will do anything
they can to influence the outcome of a deal based on performance, rather than
socialization. For the past 80 years, a supplier had done business with CP Rail, and
the question of how much the anchor cost was always raised. The procurement started
working on an index that included a Stats Canada index for materials, a Quebec
energy index, and a Consumer Price index for labor. This enthused the argument
away from "we've always done business" to a more impartial viable rapport.
Ken believes that social events should not influence the buyer’s decision
especially if they are cautious in the key evaluation criteria and pricing transparency.
However, the issue of whether coercion can take place will always be lifted. He
concluded that suppliers should not be managed to shove their total market costs
depending on customer connections, but should be happy to disclose the cost with

1
clients. The relationship between suppliers and customers is vital, but it must be
balanced with market demands.

You might also like