Strategic Relationship Development

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Strategic Relationship Development

Strategic Relationship Management


There are two types of business relationship in the market direct relationship that is in business to business market, and indirect relationship that is business to consumer market. The direct business to business relationship is customized and personal. It is far more personalized than the customer market. Two companies might engage themselves working hand in gloves to fulfill the need of final consumer.

In business to business market, relations are formed by the backbone of chief supplier agreement for bigger companies. Whereas, a huge company needs a routine delivery of parts of good for the production process, it does not only focus on the quality of the material or finished goods bought.

In this chief supplier deal components like flexibility, delivery, lead time and technicalities are crucial to the fine flow of product through the production cycles. Additionally, there are commonly technologies tie in the form of machineries, software of computer, systems and shared private property. The significance of quality of supplied goods quality and long term commitments mean that purchaser is in favour of building strong relationship with core suppliers.

At the contract levels these may meant to sign up the Service levels Agreement specifying commitment and penalty of commitment or bonus for achieving certain standard of services. Although, Service level agreement is commonly a last resort relationship worked out in bargaining between accounts manager and purchasers.


Nevertheless, since the costs linked with maintenance of relationships, purchaser prefers to minimise the numbers of important supplier they used by altering suppliers placed into tier according to the strategic significance of the supplies. By considering and developing strong long term relationship with some important supplier, purchaser looks to sustain permanence of supplies, sharing development cost and minimising purchasing cost (Kamp, 2006, p.66). To diminish the menace of suppliers profiteering here are generally comprehensive and honest supplier review and some forms of open book policies where the purchaser can inspect the cost.

In this situation sustaining a strong and profitable relationships are essential. Being a fundamental supplier a lot meant that customers will accounts for numerous percentages point of turnovers (Lundgren, 1995, p.229). Significant how well they delivered, what they needed to progress and being able to administer and observe this across a wide range of high individual customer lead to the needs for periodic Quality of Service Review with customer to decide their strategic priority.

In the realm of business-to-business (B2B), many services are designed to provide backstage sustainability support for consumer-facing services or other B2B firms. For example, Shorebank Pacific provides financing specifically for sustainable business ventures. Shorebank helps clients increase triple-bottom-line benefits by bundling sustain-ability consulting with its financing services (Peppers, 2011, p.231). The legal firm Tonkon Torp LLP offers specialized legal services to firms in the renewable energy industry. They deal with providers of wind power, biofuels, solar energy, and wave energy throughout the western United States.

Consumers and businesses are becoming increasingly aware of and concerned about the back stage processes behind basic services such ...
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