A Framework of Retailer-Manufacturer Cooperation and Coopetition: Consumer Durable Goods Retailers' Case Studies

Abstract

The purpose of this paper is to develop a framework of cooperation and coopetition between retailers and key manufacturers from a perspective of retailers offering consumer durables. In order to answer the research questions semi-structured, in-depth and face-to-face interviews with managers of six SMEs or large retailers operating in Poland and offering consumer durables were carried out. The empirical studies confirm both cooperation and coopetition between retailers and manufacturers - suppliers of consumer durables depending on, among others, the category of consumer goods and the balance of power between retailers and manufacturers. The scope of cooperation is not too wide, and concerns only some of the value chain processes indicated in the literature. Conducted studies are exploratory and need to be deepen with the use of quantitative research that will help determine the impact of the balance of power between manufacturers and retailers and the strength of retailer-manufacturer relations on the range / areas and financial and non-financial performance of this cooperation. The originality of this work lies in studying some aspects of retailers' relations with their key suppliers operating in consumer durables market.

Headnote

ABSTRACT

Objective: The purpose of this paper is to develop a framework of cooperation and coopetition between retailers and key manufacturers from a perspective of retailers offering consumer durables.

Research Design & Methods: In order to answer the research questions semi-structured, in-depth and face-to-face interviews with managers of six SMEs or large retailers operating in Poland and offering consumer durables were carried out.

Findings: The empirical studies confirm both cooperation and coopetition between retailers and manufacturers - suppliers of consumer durables depending on, among others, the category of consumer goods and the balance of power between retailers and manufacturers. The scope of cooperation is not too wide, and concerns only some of the value chain processes indicated in the literature.

Implications & Recommendations: Conducted studies are exploratory and need to be deepen with the use of quantitative research that will help determine the impact of the balance of power between manufacturers and retailers and the strength of retailer-manufacturer relations on the range / areas and financial and non-financial performance of this cooperation.

Contribution & Value Added: The originality of this work lies in studying some aspects of retailers' relations with their key suppliers operating in consumer durables market.

Article type: research paper

Keywords: retailer-manufacturer relationships; cooperation; coopetition; consumer durables

JEL codes: L190; L810; M310

Rseceived: 14 August 2016 Revised: 25 January 2017 Accepted: 1 February 2017

INTRODUCTION

The issue of inter-organizational relationships is the subject of numerous publications and it is emphasized that organizations must rely on cooperation with other organizations to accomplish strategic goals (e.g. Nooteboom, 2004; Cygler, 2009). The authors refer to different theoretical concepts, including game theory (Brandenburger & Nalebuff, 1995), the resource-based approach (e.g. Romanowska, 2002; Lavie, 2006), the transaction costs theory (Hennart, 1988; Geyskens, Steeenkamp, and Kumarf, 2006) and network approach (e.g. Czakon, 2009, 2015). Plenty of publications are focused not only on bilateral relations, but also on multilateral, including the phenomenon of cooperation and coopetition in the context of networks (e.g. Peng & Bourne, 2009). Many researchers have focused primarily on horizontal relationships, devoting less attention to vertical relationships (e.g. Chen & Hall, 2007; Jap, 1999, 2001), and especially to the relations between retailers and manufacturers.

The authors emphasize the importance of the relational/network mechanism including links of cooperation and coopetition for the companies development, evaluating retail companies and impact on their innovation and competitiveness. Interorganizational relations, including retailer-manufacturer cooperation and coopetition, make it possible to increase the retailer's resource potential by access to complementary and valuable resources of manufacturers- partners of the relationship, which contributes to more effective competition in the market (Stanczyk-Hugiet, 2012).

There are different models of firm growth based on the inter-organizational relationships (Stanczyk-Hugiet, 2011). In these models, firm growth is explained: through access to resources (Tsang, 1998), by processes such as knowledge sharing, its creation and conversion (e.g. Combs, Ketchen, & Hoover, 2004), the creation of innovation (e.g. Mention, 2011), by capturing the value elaborated within the network (e.g. Castaldo, 2007) or by expanding the borders with changes in cross-organizational network configuration (Santos & Eisenhardt, 2005).

The increased interest in the topic of the relationships between retailers and manufacturers is related to the transformation of the role of retailers in the supply chain (Bloom & Perry, 2001; Amato & Amato, 2008) and changes in their business models. Among the factors determining the role of modern retailers and their relationships with suppliers are indicated, inter alia, processes of consolidation of retailers, the development of information technology and systems supporting customer relationship management (Corsten & Kumar, 2005) and an increase in the diversity of distribution channels (Seiders, Berry & Gresham, 2000) including the appearance of new types of retailers (Internet auctions, group-buying platforms, etc.). It is accompanied by an increase in sales and the importance of retailers' private brands (Soberman & Parker, 2006). As a result of changes in retailers' and manufacturers' business models, the traditional boundaries between them are blurring (Yew & Johansen, 2008). For years, manufacturers and retailers were included in separate strategic groups (Porter, 1976). However, in recent years differences between the quality of retailers' brands and manufacturers' brands have been reduced. A change is observed in the manufacturers' strategy in response to competition from retailers' private brands, including cooperation in the manufacturing of products under these brands (Verhoef, Nijssen, & Sloot, 2002; Witek-Hajduk, 2015). Hence, retailers not only work with manufacturers as their brokers, but also in other processes in the value chain, and often compete with them for the same customers, among others, offering products under their private brands (Anderson, Day, & Rangan, 1997). This favours the intensification of cooperation and coopetition between retailers and manufacturers.

In several publications on the relationships between manufacturers and retailers, the authors undertake issues such as: the nature of these relationships (Noordewier, John, and Nevin, 1990), dependence (Heide & John, 1988) and trust (Kumar, Scheer, & Steenkamp, 1995; Doney & Cannon, 1997), balance of power and sources of leverage (Bloom & Perry, 2001; Dapiran & Hogarth-Scott, 2003), competition between manufacturers and retailers' brands (Oubiña, Rubiuo, & Yaüge, 2006; Gomez & Benito, 2008), cooperation with the manufacturers regarding their production (Witek-Hajduk, 2015), manufacturers' cooperation with large retailers (Ktosiewicz-Górecka, 2010) and factors affecting the results of these relationships (Palmatier, Dant, Grewal, and Evans, 2006). The above issues are examined with particular regard to two perspectives (Cox, Sanderson, & Watson, 2000): marketing (e.g. Corsten & Kumar, 2005; Brennan & Turnbull, 1995) and value chain management (e.g. Segal, 1989; Salmon, 1993). Research on the manufacturers-retailers cooperation and coopetition take both retailers (e.g. Ahmed & Hendry, 2012) and manufacturers' perspective (e.g. Gomez-Arias & Acebron-Bello, 2008).

Many publications on retailers-manufacturers cooperation and coopetition concern the FMCG market, including food (Kotzab & Teller, 2003). Only a minor amount of studies deal with retailers' cooperation with consumer durables manufacturers (e.g. Chow, Kaynak, & Yang, 2011). Few are also publications on retailers' coopetition with their suppliers (e.g. Kim, Kim, Pae, & Yip, 2013).

In order to fill this research gap, the aim of this work is a description and analysis of the framework of cooperation and coopetition between retailers and consumer durables manufacturers from the perspective of retailers and to answer the following research questions: 1) What is the nature and the strength of the relationships between retailers and consumer durables manufacturers?; 2) What are the areas and forms of retailers' cooperation/coopetition with manufacturers supplying consumer durables?; 3) What are individual and joint benefits from cooperation/coopetition with manufacturers as perceived by retailers? To answer the research questions in-depth interviews with managers of six retailers operating on the Polish market for consumer durables were carried out.

The article consists of four parts. The first part presents the literature review on cooperation and coopetition between retailers and manufacturers. The second part presents the research method. Next, the results of qualitative empirical research on a group of six retailers dealing in consumer goods durables are presented. The article closes with conclusions.

LITERATURE REVIEW

Retailers - Manufacturers' Cooperation and Coopetition

The authors of publications on the relationships between manufacturers and retailers do not agree on the naming, definitions and typologies of these relations. Authors use terms: "relations" (Yu & Pysarchik, 2002), "relationships" and "interactions" (Jeong, Hastak, & Syal, 2009). Moreover, many authors equate "relations"/"relationships" only with cooperation (Blundel & Hingley, 2001), while others indicate that cooperation is just one of the types of relations (Bengtsson, Hinttu, and Kock, 2003).

Taking into account the relationship nature (competition, cooperation) Bengtsson et al. (2003) distinguish the following types of relationships: competition, cooperation, coopetition and coexistence. The retailer-manufacturer relationship is often a complex mixture of cooperation and competition (Borsenberger & Doisy, 2003). According to the above mentioned typology retailer's cooperation with the manufacturer means that the parties combine only relationships of cooperation and there is no competition between them. Characteristics of cooperation are: high frequency, high level of trust and substantial power connections, which can be formal or informal (Bengtsson & Kock, 2000). According to Buxmann, Ahsen, and Diaz (2008) cooperation takes place when the retailer and the manufacturersupplier come to the coordination of the planning process. Authors distinguish, however, decentralized cooperation, when the parties independently draw up plans and then exchange information on this subject, from centralized cooperation, when one party plans for both parties of the relationship. It should be added that some authors use, beyond the term "cooperation", other terms, like "collaboration" and "coordination" (e.g. Singh & Power, 2009). Many researchers use the term collaboration, sometimes highlighting its various levels. According to Vlachos, Bourlakis, and Karalis (2008) the highest level is a cognitive collaboration characterized by a high degree of trust and pursuing common goals. In the case of cooperative level of collaboration the parties exchange information and establish common goals, but also strive to achieve individual benefits. In turn, the lowest trading level of collaboration means that parties only exchange data, e.g. through a website.

Coopetition between retailer and manufacturer means that parties at the same time compete with each other and work together (Bengtsson et al., 2003). As noted by Bengtsson & Kock (2000) coopetition is characterized by high frequency of relations, significant strength and the average level of trust between the parties of the relationship, which may be formal or informal. Retailer cooperate with the supplier to achieve common goals, while competing with him to get the individual benefits (Kim et al., 2013). Coopetition relationships between the buyer and the seller are more stable and durable compared to horizontal relations between competitors (Zerbini & Castaldo, 2007). Coopetition between the retailer and the manufacturer - retailer's supplier takes place when the retailer introduces to its stores private brands in product categories, in which it cooperates with the manufacturer-supplier or the manufacturer creates its own stationary or on-line store/ stores offering the same products as the ones that are sold in stores of cooperating retailer. The nature and strength of the relationships (cooperation and competition) connecting the retailer with the manufacturer is thus defining the character of this relationship.

Elements that define the framework for retailers' relations with manufacturers are also the scope and areas of cooperation and coopetition. Swoboda, Pop, and Dabija (2010) distinguish three areas of retailers' cooperation with manufacturers: processes oriented to innovations, customers and supply chain. Cooperation in the field of innovation concerns, among others, market information exchange, market analysis, product design, product development and category management (e.g. Dupre & Gruen, 2004). On the other hand, cooperation in the customer-oriented processes includes activities such as shops design, training of sales staff, the exposure of products, loyalty programs, advertising (e.g. Ailawadi et al., 2010), other promotional activities, including those conducted at the point of sale (e.g. Park, 2004; Huang, Li, & Mahajan, 2007). Cooperation in the supply chain-oriented processes is focused on distribution, purchasing and production planning, inventory management and procurement, planning and meeting the needs of customers (e.g. Corsten & Kumar, 2005; Derrouiche, Neubert, & Bouras, 2008), as well as production of retailers' private brands by manufacturers (e.g. Oubiña, Rubiuo, & Yaüge, 2006).

An important element defining a framework of retailers' cooperation and coopetition with manufacturers is the form and duration of the relationship. Retailers, which are characterized by long-term orientation (Hogarth-Scott & Parkinson, 1993) expect benefits from cooperation in the long run (Morgan & Hunt, 1994) and seek to maximize profits from the series of transactions (Ganesan, 1994), while the retailers characterized by short-termorientation expect immediate results and seek to maximize profits from a single transaction. In addition, Hogarth-Scott and Parkinson (1993) distinguish the following six forms of retailers' cooperation with suppliers forming a continuum because of the degree of control in the pursuit of economic efficiency: "pure transactions", repeated transactions, long-term relationships, real partnership, strategic alliances and network organizations.

Another element defining a framework for retailers' cooperation and coopetition with the manufacturers are the outcomes/benefits of this relationship. Retailer's cooperation and coopetition with suppliers leads to the achievement of both individual and joint benefits for relationship parties (Pereira, Brito, & Mariotto, 2013). Terpend, Tyler, Krause, and Handfield (2008) list following benefits of cooperation: operational performance improvements, integration-based improvements, capability-based improvements, and financial performance improvement. These relationships serve not only to share knowledge (Heide & George, 1990), but also to create competitive advantage by both partners, which wouldn't be possible to achieve acting alone (Simatupang & Sridharan, 2002). This is possible thanks to the acquisition of complementary resources from the other side of the relationship (Dyer & Singh, 1998), or by reducing transaction costs (Svensson, 2002). As noted by Kim et al. (2013), the joint benefits are the bigger, the stronger the cooperative and synergistic dimension of coopetition is.

So the key elements forming the framework of cooperation and coopetition between retailers and manufacturers are: strength of a relationship of cooperation and competition between them, forms of cooperation, areas of cooperation/coopetition and individual and joint benefits of cooperation.

MATERIAL AND METHODS

In order to answer the research questions semi-structured, in-depth and face-to-face interviews with managers of six SMEs or large retail enterprises (according to the statutory definition) operating in Poland and capable of offering consumer durables were carried out. In the study, as consumer durables we include products that are frequently purchased and the product's lifetime is relatively long (Cole, 1962). In accordance with the recommendations in the literature, each of the interviews with retailers' managers lasted 1.5-2.5 hours.

The literature justifies the use of qualitative research methods in the field of management and emphasizes that mentioned methods allow to research little-known issues (e.g. Denyer & Tranfield, 2006; Cassell, Symon, Buehring, & Johnson, 2006; Czakon, 2009). It is stressed that the goal is to go beyond the rational opinions and understand the participants perspectives and the phenomena that is under the study (Stysko-Kunkowska, 2014). Researchers often use in-depth and face-to-face interviews, and as a research tool - semi-structured questionnaire containing a number of open questions (Zaborek, 2009; Gó'tz & Jankowska, 2014).

In order to obtain answers to research questions in management sciences one of two approaches can be taken: 1) inductive perspective, in which case empirical research is carried out first and then generalizations and theories based on the collected data are formulated or 2) the hypothetical-deductive method, consisting of hypotheses and then criticizing them by using the deductive process, enabling hypothesis confrontation with experience. In the literature, plenty of analytical strategies are distinguished including reflective and structural analysis. Among the structural strategies, inter alia the following are indicated: grounded theory, content analysis, semiotics (Malhotra & Birks, 2007), template analysis (Symon & Cassell, 2012) and a number of analytic techniques used to build and verify theoretical propositions via pattern matching (Yin, 2003). The literature highlights advantages but also limitations of the grounded theory methodology in the exploration of inter-organizational relationships, including the phenomenon of cooperation and coopetition (Gótz & Jankowska, 2014).

Purposive sampling of retailers, which is the most recommended strategy for qualitative research, was used (Saunders, Lewis, & Thornhill, 1997), to provide a variety of perspectives of the surveyed retailers due to the size of the retailer, its business model and categories of consumer durables, which are offered in the retailer's stores. We chose firms based on our knowledge about research phenomena and taking into account which retailers may deliver best insights for an issue under study and are able to provide as much information as possible to achieve the research goals (Perry, 1998). Critical, extreme, heterogeneous and homogenous strategies were used to choose participants: retailers represent different branches (heterogeneity) and managers-informants represent similar positions (homogeneity), (Stysko-Kunkowska, 2014). Interviews were conducted with managers of the surveyed retailers responsible for relations with manufacturers who are suppliers of durable consumer goods to the retailer's stores. Interviews were conducted during the period from 08.04.2015 until 21.12.2015. Characteristics of the retailers are shown in Table 1.

Three of the retailers are companies with foreign capital and three with the Polish capital. Four of the retailers are internationalized.

As a result of in-depth interviews, we obtained a comprehensive set of data on the managers' opinions regarding relationships, including cooperation and coopetition, with manufacturers of consumer durables and activities undertaken in retailers' cooperation with manufacturers who are their key suppliers. According to the recommendations from the literature (e.g. Yin, 2003), we assured the anonymity for the managers participating in the interview and their companies.

Depending on the adopted research perspective, in qualitative research two approaches in coding are used: 1) a priori, when the categories are created on the basis of existing theoretical concepts and previously completed studies with the possibility of modifying the category under the influence of empirical material and 2) grounded theory, when the categories (codes) are constructed on the basis of data (e.g. Pickard, 2007). In this research we followed structural analysis based on technical procedures involving explicit category classification systems for the purpose of identifying patterns inherent in phenomena under study (Denyer & Tranfield, 2006). The analysis was made with the following analytical categories: 1) the retailer's suppliers structure, 2) the balance of power between retailer and key manufacturers-suppliers, 3) the nature of relationships between retailer and key manufacturers, 4) the strength of cooperation between retailer and key manufacturers, 5) the strength of competition between retailer and key manufacturers, 6) forms of cooperation/coopetition between retailer and key manufacturers, 7) areas of cooperation between retailer and key manufacturers, 8) areas of coopetition between retailer and key manufacturers, 9) individual benefits of cooperation between retailer and key manufacturers, and 10) joint benefits of cooperation between retailer and key manufacturers.

All interviews were recorded and during the interviews interview protocol was used. Transcripts of the interviews were then encoded with highlights and keywords on the side-lines and numbers and letters, which were to mark the different topics and subtopics (Miles & Huberman, 1994).

RESULTS AND DISCUSSION

Framework of Retailers' Cooperation and Coopetition With Manufacturers of Consumer Durables - Research Findings Based on In-depth Interviews With Managers of Six Retailers

The surveyed retailers vary in scope and areas of cooperation with the manufacturers. Company I cooperates with approx. 800 suppliers, of which 90% are Polish manufacturers. As indicated by the retailer's manager: "We have a whole range of suppliers, from very small manufacturers from whom we buy e.g. plants - these are usually local farmers, to the monopolies." The internal value chain of the company covers purchasing, marketing and sales, as well, although not as large range - product design. Polish suppliers provide mainly manufacturers' brands, retailer's private brands are outsourced to external manufacturers, mainly foreign, with which the retailer is also working on other markets.

In Company II relationships with manufacturers and their structure depends on the area of activity ("fashion" vs. "non-fashion"). In each each area of activity a different business model is being used. In "fashion" 97% of the suppliers comes from Asia, where the retailer outsources production of its private brands. The company prefers to work with medium-sized manufacturers, employing at most a few dozen employees, for whom it feels that it is a partner. These companies are more flexible and have a greater sense of responsibility. In the case of the "nonfashion" suppliers are closer geographically, they are strong international brands, for which the retailer's bargaining power is much smaller, a large part are also Polish manufacturers.

Company III cooperates with various manufacturers, both Polish and foreign. Strategy of the range of products takes into account Polish local conditions. One of the signs of the cooperation is managing the range of products with strong brands in stores. As indicates retailer's manager: "We are working on this topic with our suppliers and we implement commonly agreed solutions when they affect favourably for sale and are convenient for the consumer in his purchasing decision, e.g. Apple, Nespresso, Bose, Miele, GoPro, Samsung."

Company IV works with approx. 700 suppliers, of which 85% are Polish manufacturers, also approx. 40% of private brands are produced locally. As indicated by the retailer's manager: "Our company has large autonomy of the various national bodies. There is a range of products that need to be everywhere, but it is also appreciated locality and adaptation to local customers, e.g. tiles in the southern Poland are different than in other regions of the country." As one of the most important signs of cooperation, bringing the greatest benefit, the company indicates retailer's exclusive products, according to the retailer eliminating the competition with suppliers. The company prefers long relationships based on cooperation and negotiations. Company's manager also confirms benefits from sharing knowledge with key suppliers - manufacturers of strong brands: "Key suppliers are very well aware of what should be a group of products to comprehensively serve the customer, without them, this obligation would rest with us, and we would have to conduct deep research".

Company V tries to diversify its suppliers, as indicated by company's manager: "We had a supplier for approx. 45% of sales, problems began, imposing worse conditions, but in the end, after 2 years we ended working with him." As the main threat the manager perceives the fact that manufacturers are beginning to look by themselves for new sales channels, e.g. Internet and supermarkets: "Manufacturers are looking for sales by themselves, we are afraid of such a situation. Distribution market shrinks, only the largest last and are trading all goods to survive. The chain is shorter."

Manager of the Company VI indicates a problem among retailers themselves: "Manufacturers will be happy to cooperate, but retailers think mainly in terms of low price and quality." A major role is played by electronic business, on-line store it in the case of this retailer has up to 60-70% of sales. The entire purchasing process is also virtual, as stated by company's manager: "We can order through on-line purchase platforms, also in Polish companies. Even small suppliers have their sales platforms. Mobile apps are necessary in this business, it is a complicated product."

Table 2 presents a framework of cooperation and coopetition of the surveyed retailers with their manufacturers and the benefits of cooperation from the retailers' perspective.

Each retailer refers above all, financial and marketing benefits of cooperation with manufacturers, as well as the trust, reducing risk and sharing knowledge about consumer preferences. Coopetition in relations between retailers and manufacturers is mainly noticed in case of large manufacturers, which have their own stationary or on-line stores (three interviewed retailers), as well as in relations with retailer's private brands manufacturers (two interviewed retailers). Company IV doesn't notice competition, even when the manufacturer starts its own distribution.

Only three out of six retailers indicate joint benefits, mainly referring to sharing knowledge, exchanging information and experience with manufacturers. As highlighted by manager of Company I: "Each channel of obtaining information is good. If the supplier is a specialist in a particular field, we benefit from his knowledge. There are also our suggestions for manufacturers as to the appearance of products." The company is also trying in some areas to pass their knowledge to manufacturers: "We are in a certain sense educators of our suppliers, e.g. in wood products and certification, we stimulate them to do something in this regard. If not cooperating with us, they would incur penalties for e.g. the lack of proper documentation." In case of Company II cooperation with "non-fashion" manufacturers is complex: "Manufacturers often suggest what could be improved or changed in the product concept. We or the manufacturer suggest something when we want to introduce unique or innovative product". Company III exchanges information with their manufacturers mainly on consumer trends and buyers preferences.

CONCLUSIONS

The conducted in-depth interviews with managers of six retailers of consumer durables, including four large and two SMEs show a complex picture of retailers relationships with consumer durables manufacturers, especially those of key importance to the retailer. The empirical studies showed different types of competitive and cooperative relations in the six studied companies and confirm relations such as cooperation and coopetition between retailers and manufacturers who are suppliers of consumer durables (Kim et al., 2013). A diverse range of cooperative relations between the parties was found depending on, among others, the category of consumer goods and the balance of power between retailers and manufacturers on the market, including the strength of manufacturers brand. The scope of cooperation is not too wide, and concerns only some of the value chain processes indicated in the literature (see. Freedom, Pop, & Dabija, 2010). The surveyed retailers cooperate with manufacturers primarily in the innovation-oriented and customeroriented processes and above all in promotional activities, especially those undertaken in the point of sale or using brochures and shop windows which are usually financed by the manufacturers (Park, 2004). Only three surveyed retailers indicated joint advertising campaigns with manufacturers in other media, including the mass media or e.g. organizing joint promotional events in public space. Several retailers cooperate with manufacturers in the exchange of market information, including the results of marketing research, knowledge about the customers preferences, sometimes also sales data. From the perspective of a few of the surveyed retailers (especially of consumer electronics, home appliances and hardware) an important role is played by cooperation in the field of customer service. In four cases, the cooperation also applies to the delivery by manufacturers of certain products exclusive to the retailer. Only bookstore pledged cooperation with producers in terms of inventory management and orders. Compared to the FMCG market (Kotzab & Teller, 2003) the scope of cooperation of the surveyed retailers in planning and meeting the needs of customers is limited: only one declared reliance upon suggestions from manufacturers who are considered experts and exchanging ideas about the look and functionality of products and packaging. None of the surveyed retailers cooperate with manufacturers in the field of the category management. Only two large retailers indicated that they consider such cooperation with key manufacturers in the future.

The study also confirmed the presence of coopetition in relations with manufacturers (Kim et al., 2013), but with different strengths depending on the area of activity: the strongest in the case of fashion, including clothing, correction glasses frames or sunglasses, but also computer accessories / electronics / home appliances. In addition, manufacturers-suppliers of consumer durables are still primarily using distribution through retailers, rather than direct (owned or franchised stationary stores or on-line manufacturers' stores), although the growing importance of this second strategy was reported by the interviewed retailers.

The studied retailers above all indicate transactional relations with manufacturerssuppliers of consumer durables, including repetitive transactions. Some retailers declared long-term framework agreements especially with key manufacturers. There was no capital connection of the surveyed retailers with manufacturers-their suppliers. Forms of relations of the retailers with manufacturers show the fact that their orienta- tion is rather short than long-term. Long-term orientation is concerned with the relationship with key partners (Hogarth-Scott & Parkinson, 1993).

According to the managers representing studied retailers, cooperation with their key manufacturers-suppliers is the source of most of all individual benefits, including primarily financial benefits and especially the increase in sales as the result of obtaining exclusivity for specific product models, and cost reduction. It was pointed out also individual benefits such as reducing risk and the branding benefits. Three retailers also indicated the acquisition of knowledge and know-how. Only half of the surveyed retailers pointed joint benefits for both parties. This can be explained by the fact that compared to the FMCG market, the scope and strength of cooperation and coopetition on the consumer durables market are smaller.

As a result of the research a model of retailer-manufacturer relationships was elaborated (Figure 1).

Conducted qualitative studies are exploratory and need to be deepen with the use of quantitative research. Quantitative research will help determine the impact of the bargaining power of the relations' partner, the balance of power between manufacturers and retailers in the relevant market and the nature (cooperative and competitive) and strength of retailer-manufacturer relations on the range / areas and financial and non-financial performance of this cooperation. In addition, it is worth to confront the perspective of retailers with the perspective of manufacturers.

Furthermore, the limitation of the study is that it is focused on bilateral relations between retailer and key manufacturer. Future research should take into account the perspective of network relations.

Sidebar

Suggested citation:

Witek-Hajduk, M.K., & Napiórkowska, A. (2017). A framework of retailer-manufacturer cooperation and coopetition: consumer durable goods retailers' case studies. Entrepreneurial Business and Economics Review, 5(1), 59-76, DOI: http://dx.doi.org/10.15678/EBER.2017.050104

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