Eastern-Western supplier-customer relationships in agricultural machinery industry: results of an empirical investigation in the Czech Republic, Hungary, Romania, Ukraine, and Germany

Abstract

International trade between Germany and the young reform states in Central and Eastern Europe is growing rapidly. Germany is the most important trading partner for nearly all of the Central and Eastern European countries. Nevertheless, there are relatively few empirical studies concerning purchasing activities of western manufacturers in Central and Eastern Europe. Especially the characteristics of successful relationships between Central and Eastern suppliers and their western customers have not been addressed. This paper presents results of a survey carried out in the Czech Republic, Romania, Hungary, Ukraine and Germany. The research reported, contributes towards answering the following research questions. (1) What are the reasons for establishing Eastern-Western supplier-customer relationships? (2) What are the characteristics of German customers buying in Central and Eastern Europe? (3) Which attributes are prominent by Eastern suppliers? (4) What are the ingredients of a successful supplier-customer relationship? The survey showed that many successful relationships between German manufacturers and Central European suppliers have been established. The importance of these relationships for both suppliers and customers is shown by the average share of materials by value bought in Central and Eastern Europe, the high specificity of the purchased materials, the types of contracts employed, and the extent of support activities. Furthermore, the study has identified the requirements and numerous attributes of successful Eastern-Western supplier-customer relationships.