Abstract
This study aims to raise which practices of buyer-supplier dyad are related to the financial performance of the manufacturing industry in Brazil. Based of 174 Brazilian companies and a total of 312 respondents, the analysis use CFA (Confirmatory Factor Analysis) to validate the measurement of constructs and multiple regressions to analyze the relationship between practices of buyer-supplier dyad and financial performance. Our results showed a positive relationship dimension--strategic sourcing and buyer-supplier relationships--with the company's financial performance. However, the supplier evaluation system showed no statistically significant relationship. The findings reinforce the lack of formalization in the buyer-supplier relationship, a situation that often hinders the development of a long-term relationship. The lack of systematic evaluations of supplier performance can generate insecurity in the relationship, since historical actions taken by suppliers could serve as a criterion of choice in a future negotiation. As practical contributed to this study, it is expected that managers understand the importance of buyer-supplier relationship to the company's financial performance.DOI: 10.12660/joscmv7n1p30-46URL: http://dx.doi.org/10.12660/joscmv7n1p30-46
Highlights
The positive influence of purchasing integration on manufacturing performance confirms anecdotal evidence about the importance of this competence
This study aims to raise which practices of buyer-supplier dyad are related to the financial performance of the manufacturing industry in Brazil
The main objective of this study is to investigate which factors of buyer-supplier dyad relate to the financial performance of the manufacturing industry in Brazil
Summary
The positive influence of purchasing integration on manufacturing performance confirms anecdotal evidence about the importance of this competence. The purchasing’s influence on final product changes, based on acquisition costs and availability analysis, technology forecasts, and supply base capability evaluations. This fact indicates the relevance of purchasing participation in strategy formulation and the need to focus on strategic performance metrics in purchasing performance evaluation and compensation systems. Companies that invest in practices to achieve this integration can expect to see commensurate gains in strategic performance (Narasimhan & Das, 2001) Practices such as strategic purchasing, supplier evaluation systems, and buyer–supplier relationships are important with respect to the firm’s financial performance (Carr & Pearson, 1999). These practices should be accompanied by internally focused purchasing initiatives that enable purchasing to become a part of the business planning process to guide to a high level of competitive advantage
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