A transaction costs approach to purchasing portfolio management

Abstract

PurposeThe purpose of this paper is to propose a theoretically sound and empirically tested classification system composed of purchasing strategic categories as a basis for purchasing portfolio models.Design/methodology/approachAn international, cross‐industry survey has been designed to assess the characteristics and corresponding strategies of the purchasing categories.FindingsThe paper operationalises the constructs derived from previous scientific contributions related to purchasing portfolio management and transaction cost economics (TCE) to empirically test the purchasing portfolio. In total, four different types of strategic categories have been identified, and distinctive competitive priorities have been found.Research limitations/implicationsManagers might be able to identify different types of purchasing strategic categories, whose characteristics drive specific purchasing strategies. Longitudinal data and more extensive tests of the characteristics of each category might contribute to improving the proposed research framework.Originality/valueThe research overcomes some of the classical limits of purchasing portfolio models, including the absence of a theoretical and empirical basis. In particular, TCE is used to support and expand traditional purchasing portfolio approaches, and a broad empirical base is used to test such an approach.