Buyer behaviours and the performance of the supply chain: An international exploration

Abstract

This paper studies the effects of buyer?supplier interaction in a supply chain environment. It focuses on the effects of buyer behaviours (such as supplier selection, number of suppliers, percentage of outsourcing, and frequency of production changes) on the performance of the supply chain. Using data collected from machine tool manufacturers around the world, the various behaviours of buyers are examined to see how they induce or mitigate the degree of uncertainty experienced by suppliers and thus affect suppliers' delivery performance. In addition, it was investigated how such buyer behaviours could further affect the supply chain's ability to perform as expected. The statistical results suggest that many buyer behaviours that have no direct effect on buyer's performance can have a significant effect on their suppliers' performance. Specifically, buyer behaviours directly manifest in supplier performance and only indirectly manifest in their own performance. This can give the buyer the false impression that the supply base is harming performance, when the real problem is the way the buyer manages the supply chain. The results vary by region of the world, suggesting that any theory that links buyer behaviours to supplier performance will need to consider a firm location.