The Role of Supplier Quality in e-Procurement Negotiation

Radoslav Delina, Mária Michňová, Peter Húska, Ján Spišák

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.

Keywords


rating; supplier quality; electronic reverse auction; price premium; e-procurement

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References


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DOI: http://dx.doi.org/10.12776/qip.v24i1.1388

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Copyright (c) 2020 Radoslav Delina, Mária Michňová, Peter Húska, Ján Spišák

ISSN 1335-1745 (print)
ISSN 1338-984X (online)
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