The authors report the findings from a field study of purchasing agents negotiating rebuy purchases of component parts. The negotiating stance adopted by industrial buyers is characterized by their reliance on three basic negotiation strategies: problem solving, manipulating perceptions about competition, and tough tactics. A structural model relating the purchasing agent's use of each of these strategies to six characteristics of the purchase context (material cost sensitivity of the buying firm, supplier competition, uniqueness of the buying firm's specifications, buyer's cooperative orientation, having information, and formal planning) is developed and empirically tested with data collected in a national survey of more than 300 purchasing agents. The results demonstrate the ability of the contextual variables to predict the emphasis purchasing agents will place on each of the individual strategies in any particular set of negotiations.
Get full access to this article
View all access options for this article.
References
1.
AldersonWroe (1957), Marketing Behavior and Executive Action: A Functionalist Approach to Marketing Theory.Homewood, IL: Richard D. Irwin, Inc.
2.
ArmstrongJ. Scott, and OvertonTerry S. (1977), “Estimating Nonresponse Bias in Mail Surveys,”Journal of Marketing Research, 14(August), 396–402.
3.
BacharachSamuel B., and LawlerEdward J. (1981), Bargaining: Power, Tactics, and Outcomes.San Francisco: Jossey-Bass Inc., Publishers.
4.
BarlowC. Wayne, and EisenGlenn P. (1983), Purchasing Negotiations.Boston: CBI Publishing Company, Inc.
5.
BentlerP. M., and BonettDouglas G. (1980), “Significance Tests and Goodness of Fit in the Analysis of Covariance Structures,”Psychological Bulletin, 88(November), 588–606.
6.
BonomaThomas V., and JohnstonWesley J. (1978), “The Social Psychology of Industrial Buying and Selling,”Industrial Marketing Management, 7, 213–24.
7.
BouchardThomas J.Jr. (1976), “Field Research Methods: Interviewing, Questionnaires, Participant Observation, Systematic Observation, Unobtrusive Measures,” in Handbook of Industrial and Organizational Psychology, DunnetteMarvin D., ed. Chicago: Rand McNally College Publishing Company, 363–413.
8.
CampbellDonald T. (1960), “Recommendations for APA Test Standards Regarding Construct, Trait, or Discriminant Validity,”American Psychologist, 15(August), 546–53.
9.
CampbellN. C. G. (1985), “An Interaction Approach to Organizational Buying Behavior,”Journal of Business Research, 13(February), 35–48.
10.
CardozoRichard N., and CagleyJames W. (1971), “Experimental Study of Industrial Buyer Behavior,”Journal of Marketing Research, 8 (August), 329–34.
11.
CloptonStephen W. (1984), “Seller and Buying Firm Factors Affecting Industrial Buyers’ Negotiation Behavior and Outcomes,”Journal of Marketing Research, 21(February), 39–53.
12.
CookThomas D., and CampbellDonald T. (1979), Quasi-Experimentation: Design and Analysis Issues for Field Settings.Boston: Houghton Mifflin Company.
13.
CoreyE. Raymond (1978), Procurement Management: Strategy, Organization, and Decision-Making.Boston: CBI Publishing Company, Inc.
14.
CoreyE. Raymond (1983), Industrial Marketing: Cases and Concepts.Englewood Cliffs, NJ: Prentice-Hall, Inc.
15.
CouchArthur, and KenistonKenneth (1960), “Yeasayers and Naysayers: Agreeing Response Set as a Personality Variable,”Journal of Abnormal and Social Psychology, 60(2), 151–74.
16.
CrowneDouglas P., and MarloweDavid (1964), The Approval Motive: Studies in Evaluative Dependence.New York: John Wiley & Sons, Inc.
17.
DayRalph L., MichaelsRonald E., and PerdueBarbara C. (1988), “How Buyers Handle Conflicts,”Industrial Marketing Management, 17(May), 153–60.
18.
DeutschMorton (1973), The Resolution of Conflict: Constructive and Destructive Processes.Newhaven, CT: Yale University Press.
19.
DoblerDonald W., and LeeLamarJr., and BurtDavid N. (1984), Purchasing and Materials Management: Text and Cases.New York: McGraw-Hill Book Company.
20.
DwyerF. Robert, SchurrPaul H., and OhSejo (1987), “Developing Buyer-Seller Relationships,”Journal of Marketing, 51(April), 11–27.
21.
DwyerF. Robert, and WalkerOrville C.Jr. (1981), “Bargaining in an Asymmetrical Power Structure,”Journal of Marketing, 45(Winter), 104–15.
22.
GrahamJohn L., KimDong Ki, LinChi-Yuan, and RobinsonMichael (1988), “Buyer-Seller Negotiations Around the Pacific Rim: Differences in Fundamental Exchange Processes,”Journal of Consumer Research, 15(June), 48–54.
23.
HahnChan K., KimKyoo H., and KimJong S. (1986), “Costs of Competition: Implications for Purchasing Strategy,”Journal of Purchasing and Materials Management, 22(Fall), 2–7.
24.
HåkanssonHåkan, and WootzBjörn (1975), “Supplier Selection in an International Environment—An Experimental Study,”Journal of Marketing Research, 12(February), 46–51.
25.
JöreskogKarl G., and SörbomDag (1982), “Recent Developments in Structural Equation Modeling,”Journal of Marketing Research, 19(November), 404–16.
26.
JöreskogKarl G., and SörbomDag (1986), LISREL VI: Analysis of Linear Structural Relationships by the Method of Maximum Likelihood: User's Guide.Mooresville, IN: Scientific Software, Inc.
27.
KarrassChester L. (1974), Give and Take: The Complete Guide to Negotiating Strategies and Tactics.New York: Thomas Y. Crowell Company.
28.
KrapfelRobert E.Jr. (1985), “An Advocacy Behavior Model of Organizational Buyers’ Vendor Choice,”Journal of Marketing, 49(Fall), 51–9.
29.
KutschkerMichael (1985), “The Multi-Organizational Interaction Approach to Industrial Marketing,”Journal of Business Research, 13(October), 383–403.
30.
LewickiRoy J., and LittererJoseph A. (1985), Negotiation.Homewood, IL: Richard D. Irwin, Inc.
31.
McAlisterLeigh, BazermanMax H., and FaderPeter (1986), “Power and Goal Setting in Channel Negotiations,”Journal of Marketing Research, 23(August), 228–36.
32.
McFillenJames M., ReckRoss R., and BentonW. C. (1983), “An Experiment in Purchasing Negotiations,”Journal of Purchasing and Materials Management, 19(Summer), 2–8.
33.
MoskalBrian S. (1984), “Just in Time: Putting the Squeeze on Suppliers,”Industry Week (July 9), 59–63.
34.
MoyerReed, and BoewadtRobert J. (1971), “The Pricing of Industrial Goods: A Departure from Conventional Wisdom,”Business Horizons, 14(June), 27–34.
35.
NaumannEarl, LincolnDouglas J., and McWilliamsRobert D. (1984), “The Purchase of Components: Functional Areas of Influence,”Industrial Marketing Managment, 13(May), 113–22.
36.
NewmanRichard G. (1966), “Some Comments on Negotiation,”Journal of Purchasing, 2(May), 52–66.
37.
PerdueBarbara C., DayRalph L., and MichaelsRonald E. (1986), “Negotiation Styles of Industrial Buyers,”Industrial Marketing Management, 15(August), 171–6.
38.
PorterMichael E. (1980), Competitive Strategy: Techniques for Analyzing Industries and Competitors.New York: The Free Press.
39.
PruirtDean G. (1981), Negotiation Behavior.New York: Academic Press, Inc.
40.
RahimM. Afzalur (1983), “A Measure of Styles of Handling Interpersonal Conflict,”Academy of Management Journal, 26(June), 368–76.
41.
RubinJeffrey Z., and BrownBert R. (1975), The Social Psychology of Bargaining and Negotiation.New York: Academic Press, Inc.
42.
SchurrPaul H., and OzanneJulie L. (1985), “Influences on Exchange Processes: Buyers’ Preconceptions of a Seller's Trustworthiness and Bargaining Toughness,”Journal of Consumer Research, 11(March), 939–53.
43.
SiegelSidney, and FourakerLawrence E. (1960), Bargaining and Group Decision Making: Experiments in Bilateral Monopoly.New York: McGraw-Hill Book Company, Inc.
44.
ThomasKenneth (1976), “Conflict and Conflict Management,” in Handbook of Industrial and Organizational Psychology, DunnetteMarvin D., ed. Chicago: Rand McNally College Publishing Company, 889–935.
45.
WaltonRichard E., and McKersieRobert B. (1965), A Behavioral Theory of Labor Negotiations: An Analysis of a Social Interaction System.New York: McGraw-Hill Book Company.
46.
WaltonRichard E., and McKersieRobert B. (1966), “Behavioral Dilemmas in Mixed-Motive Decision Making,”Behavioral Science, 11(September), 370–84.
