Question

discuss any five types of supplier relationship using examples to explain how the relationships can be applied in business transactions

Answer 1

Five types of supplier relationships :

• Buy the market - Involves a great amount of business with market competitors as the relationship is neither too friendly nor too rivalrous. In a business transaction , this type of a relationship is bound to be flexible and provide quality products.
  
• Partnerships - Usually has long-term contracts with a lot of information being shared. There is utmost trust among the partners, hence relatively less business with other market competitors. Benefits that can be applied to business transactions include flexibility and product delivery success
  
• Strategic alliances - A strategic alliance could be applied to a business transaction on the basis of a long-term relationship where the partners fully trust each other with complete details about everything. The scope of business with competitors is almost close to zero. Could be highly cost effective, quality checked and flexible in transactions.
  
• Backward integration - Having full control over the supplier is a key characteristic of this relationship. Even through this method, important information is completely shared. Only positives in a business transaction could be cost effeciency and delivery success, since there is complete control over the supplier.
  
• Ongoing relationships - The contract is of a medium-term length in this relationship. While ideas might be open to sharing partial information with the supplier and also open to business with rivals. Quality production is a benefit of this type of a relationship.