CIMA E1 Syllabus E1. Operations management - Relationship with Suppliers - Notes ^{12 / 21}

Traditionally, the focus was on the price.

Businesses would switch suppliers regularly to keep the prices down.

Information was viewed as a prized asset and would not be shared with suppliers for fear of loss of power.

The focus now is on working together and forming relationships.

It helps in satisfying customer needs and increasing market share.

Information is shared between businesses in an open and collaborative manner.

It is based on the exchange of products or services within an agreed timescale for an agreed price.

There is little trust between the supplier and customer. The relationship is adversarial.

Adopted by suppliers to recognise and meet customer needs in order to retain customers.

Involves long term association (Joint venture) after recognising mutual dependency.

Skills and resources are shared to achieve mutual benefits.