Coordinating collaborative joint efforts with suppliers: the effects of trust, transaction specific investment and information network in the Dutch flower industry

Abstract

PurposeIt is the aim of this paper to discuss the value of trust and the effects of transaction specific investments for the relative degree of collaborative joint efforts, and also to assess the moderating effect of the information network on such joint efforts.Design/methodology/approachThe paper takes the perspective of the buyer making the joint effort decision and draws on transaction cost economics, relational exchange and network perspectives to develop the hypotheses of the conceptual framework. Wholesalers and other merchant‐distributors in the Dutch flower industry provided the data to test the hypotheses.FindingsThe results show the importance of trust in coordinating the joint efforts and the joint effort response in terms of safeguarding and better integrating the transaction specific investments.Originality/valueWhile the information network does not moderate the relation between trust and joint efforts, there is a significant moderating effect of the network on the relation between transaction specific investments and joint effort. This result suggests that buyers temper their specific investments to the degree of joint effort according to the information that is obtained in the network. This implies that coordinating collaborative joint efforts with suppliers is more than just buying well. The degrees of trust, specific investments and the information from the network have managerial implications for the coordination of a buyer‐supplier relationship.