The Role of Supplier Quality in e-Procurement Negotiation

Radoslav Delina (1), Mária Michňová (2), Peter Húska (3), Ján Spišák (4)
(1) Technical University of Kosice Faculty of Economics, Slovakia,
(2) University of Economics in Bratislava Faculty of Business Economy, Slovakia,
(3) University of Economics in Bratislava Faculty of Business Economy, Slovakia,
(4) Technical University of Kosice Faculty of Mining, Ecology, Process Control and Geotechnologies, Slovakia

Abstract

Purpose: The purpose of this study is to examine the significance and the role of supplier rating as a formalised supplier quality measure to achieve better- negotiated prices and to identify price premium resulting from improved rating.

Methodology/Approach: Data from real B2B environment of electronic reverse auction SW solution ProeBiz were obtained and processed. Data from the reverse rating approach were used where the default rating value is 1 and improvements of rating lead to decreasing the rating value. Except standard descriptive statistics, non-parametric correlation and Kruskal-Wallis tests, the knowledge discovery techniques by decision trees CHAID algorithm were used.

Findings: From our empirical research results, there is the evidence of a significant positive relation of supplier quality or rating improvements on a negotiated price for suppliers. Improving rating from the default value (1.00) to (0.98-0.95) can lead to better- negotiated prices for suppliers in English auction expressed as price premium in the value of 4%.

Research Limitation/implication: Research has several limitations, esp. in the size of the sample and sectorial view as the research is based on data from construction, electro-mechanics and logistics sector.

Originality/Value of paper: The paper is original and not published in other publications.

Full text article

Generated from XML file

References

AlMaian, R.Y., Needy, K.L., Alves, T.D.C. and Walsh, K.D., 2016. Analyzing effective supplier-quality-management practices using simple multiattribute rating technique and value-focused thinking. Journal of Management in Engineering, [e-journal] 32(1), 04015035, pp.1-13. DOI: 10.1061/(ASCE)ME.1943-5479.0000364.

Beall, S., Carter, C.R., Carter, P.L., Germer, T., Hendrick, T.E., Jap, S.D., Kaufmann, L., Maciejewski, D., Monczka, R.M. and Petersen, K., 2003. The Role of Reverse Auctions in Strategic Sourcing. Tempe, AZ: CAPS Research.

Charki, M. and Josserand, E., 2006. Does trust still matter in Business relationships based on online reverse auctions?. In: F. Feltz, B. Otjacques, A. Oberweis and N. Poussing, AIM 2006 – Information Systems and Collaboration: State of the Art and Perspectives (AIM). Luxembourg, 8-9 June 2006. Bonn, Germany: Association information and management.

Dellarocas, C., 2006. Reputation mechanisms. In: T. Hendershott, ed., Handbook on Information Systems and Economics. Elsevier Publishing. pp.629-659.

Dor?ák, P., Pollák, F. and Szabo, S., 2014. Analysis of the Possibilities of Improving an Online Reputation of Public Institutions. In: P. Doucek, G. Ch. and V. Oškrdal, IDIMT-2014: Networking Societies - Cooperation and Conflict: 22nd Interdisciplinary Information Management Talks. Poděbrady, Czech Republic, 10-12 September 2014. Linz: Trauner Verlag.

Fukuyama, F., 1995. Trust: the social virtues and the creation of prosperity. Free Press.

Lekovic, V., 2012. Trust as an Institutional Factor of Economic Success. Economic Horizont, [e-journal] 14(2), pp.65-78. DOI: 10.5937/ekonhor1202063L.

Locke, R.M., 2001. Building Trust. In: APSA (American Political Science Association), Annual Meetings of the American Political Science Association. San Francisco, California, 1 September 2001.

Santos, G., Murmura, F. and Bravi, L. 2019. Developing a model of vendor rating to manage quality in the supply chain. International Journal of Quality and Service Sciences, [e-journal] 11(1), pp.34-52. DOI: 10.1108/IJQSS-06-2017-0058.

Schwarts, R., 2001. The electronic call auction: Market mechanism and trading: Building a better stock market: Too Much Transparency can be detrimental. Springer Science + Business Media New York.

Szabo, S., 2015. Determinants of Supplier Selection in E-procurement Tenders. Journal of Applied Economic Sciences, 10(7(37)), p.1153-1159.

Tsai, K. and Chou, F., 2011. Developing a Fuzzy Multi-attribute Matching and Negotiation Mechanism for Sealed-bid Online Reverse Auctions. Journal of Theoretical and Applied Electronic Commerce Research, [e-journal] 6(3), pp.13-14. DOI: 10.4067/S0718-18762011000300007.

Knack, S. and Zack, P.J., 2003. Building Trust: Public Policy, Interpersonal Trust, and Economic Development. Supreme Court Economic Review, 10, pp.91-107.

Authors

Radoslav Delina
radoslav.delina@tuke.sk (Primary Contact)
Mária Michňová
Peter Húska
Ján Spišák
Delina, R., Michňová, M., Húska, P., & Spišák, J. (2020). The Role of Supplier Quality in e-Procurement Negotiation. Quality Innovation Prosperity, 24(1), 29–39. https://doi.org/10.12776/qip.v24i1.1388

Article Details

Similar Articles

1 2 3 4 5 6 7 8 9 10 > >> 

You may also start an advanced similarity search for this article.

Electronic Auctions: Role of Visibility Settings in Transparency Analysis

Radovan Dráb, Radoslav Delina, Tomáš Štofa
Abstract View : 1604
Download :664