Effect of strategic purchasing on supplier development and performance: A structural model

Abstract

Purpose: This purpose of this paper is to introduce strategic purchasing (SP) and supplier development (SD) as constructs that could have the potential to contribute to the success of relationship marketing efforts. Based on the relational view of the firm, the authors propose that SP is an antecedent of SD practices and can create value for the buying firm in terms of better purchasing performance. Design/methodology/approach: Hypotheses derived from the key features of SP and SD practices are tested using structural equation modeling through field research on a sample of 306 manufacturing companies in Spain. Findings: Findings from this study indicate that there is significant evidence to support the hypothesized model in which SP exerts a direct influence on SD practices and purchasing performance, as well as an indirect impact on purchasing performance mediated through SD. Research limitations/implications: Further research is necessary to increase our understanding of a buyer's strategic purchasing and supplier development practices and more specifically how suppliers could develop a supporting environment to facilitate the strategic alignment of these two concepts. The limitations of the survey are also discussed. Practical implications: The findings from this study provide supplying firms with an understanding of how buying firms use SD to deploy their SP initiatives in order to achieve improvements in purchasing performance. Originality/value: While there is some literature analyzing SP and the implications for buyer-supplier relationships, the relationship between SP and SD practices and their effect on purchasing performance has not been yet analyzed. © Emerald Group Publishing Limited.