A Study on the Effects of the Introduction of Web-based Purchasing Systems on the Buyer-Supplier Relationship

Abstract

The rapid expansion of the WWW is well known and has huge potential for enabling companies, large and small, to gain new marketplaces globally at low cost, or to be disintermediated by others doing so. A totally new competitive environment opening up new opportunities is upon us. As a result, the electronic commerce is growing quickly and the importance of electronic marketplace is emphasized. From the view of SCM, applying the business-to-business electronic commerce to the relationship between firms is expected to make major changes. This study focuses on the effects of the introduction of web-based purchasing systems on the buyer-supplier relationship. We conduct a case study on the Korean firms The major findings of this study are summarized as follows. First, in introductory phase, some buying firms fail to design the appropriate mechanism for business relationships. It can weaken the cooperation between buyers and suppliers. Second, for critical or customized parts, it is possible to gather the information about potential suppliers and to make business relations using it. Third, using web-based purchasing systems, capable suppliers can take more opportunities to leverage its competence for business relations. So we can expect the positive feedback.