Value Creation in Buyer–Seller Relationships: Theoretical Considerations and Empirical Results from a Supplier's Perspective

The essential purpose for a supplier and customer firm engaging in a relationship is to work together in a way that creates value for them. Various important functions of business relationships in creating value for the partner firms are widely assumed in the literature. However, there is a lack of empirical studies due to the absence of conceptual definition. Furthermore, there is a strong concentration on value for customers neglecting that value is also created for suppliers. In this study, the authors take the supplier's perspective and conceptualize value creation as a set of direct and indirect functions of customer relationships. The functions are characterized with respect to performed activities and employed resources of a customer firm. The findings from an empirical study of more than 200 firms show that both direct and indirect functions of customer relationships contribute to the value perceived by the supplier. The results of this study have considerable consequences for the management of inter-organizational relationships and networks regarding the process of how value can be created in business markets.