Global supplier selection strategies and implications for supplier performance: Turkish suppliers’ perception

Abstract

In today's global competitive environment, supplier evaluation and selection strategies are not only important for buyer performance and competitiveness, but also for supplier performance and capabilities. This study from the suppliers’ perception examines (i) the structure of supply relationships between Turkish automotive parts and components manufacturers and their global buyers, (ii) global buyers’ supplier evaluation and selection strategies, and (iii) the impact of global buyers’ supplier evaluation and selection strategies on the supplier performance in the long-term. Data from automotive parts and components suppliers in Turkey were used to test the hypotheses through multiple regression analysis. The findings of this study reveal that automotive parts and components suppliers can be either in tier-type relationhips with their global buyers or they can be out of the tier hieararchy. In a tier-type relationhip, supplier can be either first-tier supplier for some products/relationships or/and they can be second-tier supplier for other products/relationships. To establish long-term supply relationships on a global base supplier evaluation and selection strategy is based on many decision criteria and impacts on the supplier's operational, technical and financial performance in the long-term. Therefore, there is a positive association between supplier evaluation and selection strategy and supplier performance, which guides and motivates supplier firms to improve their performance and capabilities. From the supplier's perception, quality, delivery, and price along with commitment and trust are the most important dimensions in global supplier selection and establishing long-term supply relationships. Additionally, while in previous studies buyers perceive cost to be an important supplier selection criterion, in this study suppliers perceive price as more important in supplier selection. As a result, this study, revealing the perception of the suppliers, fulfils a gap and suggests several implications.