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RESEARCH ON BUYER-SUPPLIER RELATIONSHIP STRATEGY,

CONTRIBUTION TO THE COMPANY’S BUSINESS DEVELOPMENT

Didik Suyatno

, Susilo Toto Rahardjo

Universitas Diponegoro Semarang, Indonesia

1,2

didiksuyatno031@gmail.com

, susilo_tr@yahoo.com

ABSTRACT

Supplier-buyer courting method is one of the key elements contributing to the performance of the

pharmaceutical enterprise because it affects the capacity of providers to deliver and steady uncooked

substances for the producing process.The enterprise faces availability issues of uncooked substances in

phrases of time and amount required because of delays in deliver from providers (inconsistent

uncooked cloth deliver and delivery), this trouble is getting worst because of low and fluctuating

forecast accuracy conditions. The phenomenon of the COVID-19 pandemic also worsened the

condition of the availability of raw materials because the pandemic caused a shortage and disruption of

raw material supply. This have a look at is a qualitative have a look at with descriptive evaluation from

interviews consultant informants of consumers and providers. The cause of have a look at is to

research the important thing elements that impact dating techniques between providers and consumers,

in the long run contributing to enterprise continuity and performance. The effects of this situation have

a look at highlight motivation factors, dedication and obligation factors, consider and reputation

factors, courting factors, communique and statistics sharing factors, agreement factors, fine and

reliability factors, overall performance evaluation factors, help control factors, and procurement

strategies. Factors are key factors in a buyer-dealer courting approach to make sure and make sure the

provision of uncooked substances in enough quantity, timeliness and fine, contributing to commercial

enterprise continuity and overall performance.

Keywords : Relationship Strategy; Commitment; Trust and Reputation; Quality and Reliability;

Pharmaceutical Industry

INTRODUCTION

The performance and business continuity of companies, including pharmaceutical

companies, are highly dependent on the availability of raw materials to meet the needs of their

production processes (Belhadi et al., 2021). Regarding the availability of these raw materials,

the pharmaceutical industry faces time and quantity availability problems due to delivery delays

(inconsistent delivery of raw materials) exacerbated by unpredictable and variable conditions

(Rahmani et al., 2022).

The existence of the COVID-19 pandemic phenomenon worsened the condition of the

availability of raw materials because the pandemic caused a shortage of raw materials and

disruption of raw material supply because the majority of raw materials came from imports and

China as the source of the pandemic, became the largest contributor to the country of origin of

the raw material source (Timotius et al., 2022). This influences the provision of those uncooked

materials. The above troubles can in the long run have an effect on making plans and scheduling

of the manufacturing process, in the long run impacting the to supply the very last product to the

consumer and the continuity and continuity of the company's operations (Eldem et al., 2022).

In addition to the background of the practical issues discussed above, there is a theoretical

dimension to previous research studies that have identified supply chain sustainability as a

competitive advantage in an ever-changing global environment (Alfalla-Luque et al., 2018;

Vanpoucke et al., 2014). According to Emamisaleh and Rahmani (2017), sustainability is the

procedure of growing all modern wishes or strength destiny satisfy personal interests.

Improvement are key troubles for the pharmaceutical enterprise, and interest to this difficulty is

visible as essential difficulty deliver chain, so the pharmaceutical enterprise ought to make sure

suitable relationships among providers and customers (Delmas & Pekovic, 2015). In addition,

Rashed et al. (2010) discovered that the connection among shoppers and providers has a sturdy

effect on company performance, and that the buyer-dealer dating is, the extra responsive the

dealer is to the wishes of the buyer's company (Cannon, 2014). Esfahbodi, et a, (2017) reviewed

Research on Buyer-Supplier Relationship Strategy, Contribution to The Company’s Business 
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sustainability techniques and concluded that manage gadget can efficaciously improve company 
sustainability. Furthermore, it ought to be referred to buyer-supplier relationships out to be an 
fundamental a part of control obligations and are vital to cost introduction and advanced overall 
performance in lots of companies (Rungsithong et al., 2017). Wishes with skills to be (Croxton 
et al., 2001). The above explains the significance of constructing strategic relationships among 
consumers and suppliers (Ernawati et al., 2023). 
In different words, motivation to lessen costs, shorten delivery times, lessen investment, 
gather middle technology, and decrease purchasing uptime, iterative processes, and negotiation 
costs. Rashed et al., 2010. Christiansen et al. (2003) argue the significance of communique and 
data  sharing,  which  includes  the  sharing  of  performance  data  (Jaaske¨ainen,  et  al.  (2021); 
Tachizawa  et  al.,  (2015)  Highlighting  the  significance  of  help  from  Vanpoucke,  E.  and 
Vereecke, A.,2010, mentioned the significance of governance and agreement equity elements 
over  dating  revel  in  and  price  savings.Morgan  and  Hunt  (1994)  assessed  the  impact,  that's 
corroborated through research through Ivens and Pardo (2007) and Barrat and Oliveira (2001), 
wherein a dedication to long-time period collaboration plus a trust thing is supported through 
adding (Cerić, Vukomanović, Ivić, & Kolarić, 2021). 
The above problems create problems the availability of uncooked substances in phrases 
of  each  time,  and  quality,  and  as  supported  with  the  aid  of  using  preceding  studies, 
pharmaceutical  enterprise  buyers  and  suppliers,  To  make  sure  the  continuity  of  deliver  of 
uncooked substances from the factor of view (Wallace & Webber, 2017). 
For this reason, it is of great interest, answering questions, analyzing what factors need to 
be  developed  to  build  relationships  between  suppliers  and  buyers,  and  determining  the 
importance of quantity, volume, topicality and  quality (Lin & Shen, 2022). More qualitative 
studies and studies are needed to determine the availability of raw materials from a perspective. 
Ensuring  company  continuity  and  performance  and  complementing  the  results  of  previous 
studies (Lapko, Trucco, & Nuur, 2016). 
   
RESEARCH METHOD 
Method uses qualitative approach as it uses a variety of materials obtained from potential 
data gathering activities, namely in-depth interviews (Franco & Pinho, 2019). The tool aims to 
receive qualitative data with a wider range of information in the form of informant responses 
from  buyers  and  suppliers  (Viio  &  Grönroos,  2016).  The  data  sources  for  this  study  were 
primary  data,  which  included  primary  data  in  the  form  of  in-depth  interview  data  from  3 
representative  buyer  informants  and  5  supplier  informants;  It  also  includes  secondary  data, 
recorded  documents,  photographs,  cooperation  agreements  and  fixed  information  from 
procedures, etc (Moshtari, Altay, Heikkilä, & Gonçalves, 2021). 
The data obtained were qualitatively analyzed and described in descriptive form. The data 
analysis approach in this study uses the procedure presented by Burhan, B(Burhan, 2022). and 
begins  with  collection,  reduction,  presentation,  validation,  and  confirmation  of  conclusions. 
Yin,  Robert  K,  (2015)  describes  five  stages  for  analyzing  interview  data:  (1)  assembly  or 
assembly, (2) disassembly or disclosure, (3) reassembly (and assembly), and (4) interpretation., 
and (5) explained the conclusion. 
 
RESULT AND DISCUSSION   
This qualitative with reference of previous surveys, we found that factors that contribute 
to the relationship strategy between buyers and suppliers are motivating factors (Mitra & Datta, 
2014).  The  main  motivation for  the  relationship  strategy  between  buyers  and  suppliers  is  to 
build  long-term  mutually  beneficial  cooperation  partners,  ensure  the  availability  of  raw, 
timeliness, and find alternative suppliers (Soh, Jayaraman, Yen, & Kiumarsi, 2016). Providing 
solutions  by  supporting  development.  A  backup  strategy  to  ensure  reliability  and  stability 
(Colmenar-Santos,  Muñoz-Gómez,  Rosales-Asensio,  &  López-Rey,  2019).  New  product 
development projects to support product supply, price cuts or cost reductions, and sustainable 
cooperation (Minagawa, 2023). 

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The second factor is the factor of commitment and responsibility (Asrar-ul-Haq,

Kuchinke, & Iqbal, 2017). Commitment can provide confidence in the fulfillment of the

respective responsibilities of both parties. From the supplier's side, of responsibilities and

promises to supply in accordance with the quantity, time, quality requested, determined and

agreed upon as well as according to the lead time and from the buyer's perspective, of

responsibilities from the aspect of obligations, especially payment terms, etc. With this

principle of responsibility, a shared commitment will be built which will eventually build trust

between the two parties, both and long-term will be established (Wang, Shi, & Barnes, 2015).

Next important factor is trust. This, as mentioned above, has evolved from a consistent

process in the history of the relationship between suppliers and buyers to fulfill their obligations

and responsibilities, and is called reputation (Ağan, Kuzey, Acar, & Açıkgöz, 2016). A

reputation is built from the historical consistency of this relationship (Gao, Hu, & Bose, 2017).

This reputation shows how customers can trust the supplier. In relationship history, if a supplier

has a good history or reputation a buyer, it means that the supplier trusts the buyer more and

more, vice versa Conversely, if the supplier has a bad reputation and a bad experience makes it

impossible to build a relationship of trust, the buyer's trust will decline. Ultimately, that trust

and reputation can build that loyalty and loyalty as a solid foundation for your relationship

strategy between buyers and suppliers (Sarwar, Abbasi, & Pervaiz, 2012).

The next element is the relational enjoy element received from beyond interactions

among customers and providers in which this builds the muse for a cooperative courting

strategy (Zeng, 2022). Negative interpersonal reputations, which consists of breaking promises,

have a horrible impact on relationships, and vice versa, a excessive exceptional personal

popularity offers capital in constructing long-term buyer-provider relationships.

The next crucial aspect is the conversation which to be executed in a two-manner and

obvious manner. From the dealer side, we need to convey exclusive data associated with the

deliberate uncooked cloth wishes in phrases of quantity, time and specs needed, etc. which

include the improvement of new merchandise and from the client miles was hoping that data

associated with supply reality is received according the quality, quantity, time, required.

Communication and sharing of this data may be very crucial due to the fact it could construct

agree with and remove ability misunderstandings among the 2 parties. If misunderstandings are

decreased or minimal, this may additionally decrease the ability for war among suppliers and

buyers. In addition, two-manner and obvious conversation may have an effect on approaches

with a purpose to be extra efficient.

The agreement equity component may be very crucial the customer and supplier courting

as it regulates the rights and responsibilities of events. Contracts also are beneficial for

decreasing repetitive sports such as negotiations and might keep time and costs. Contracts also

are crucial as a reference resolving issues that arise, due to the fact as a reference in resolving

disputes or conflicts among 2 events. The period of the agreement is 6 months to twelve months

with the aid of using binding the amount, time, quality, payment, etc. that are agreed with the

aid of using events consistent with the description above is the ultimate settlement at this time,

speciall due to the fact miles dominated with the aid of using the rate component that

modifications in no time at this time. This agreement component is a continuation and

dedication of events which is mentioned in a proper and written shape in order to ultimately

construct a good courting among 2 events (Love, 2017).

Another critical component in constructing a courting among a dealer and a purchaser is

the component of best and versatility due to the fact this could growth accept as true with which

can in the end attain sustainability the courting among the purchaser and dealer. This best

component is a non-negotiable circumstance or as a minimum requirement. Best, flexibility is

likewise very critical. Flexibility manner being capable fast and be aware of modifications in

uncooked material wishes because of fluctuations in marketplace demand (Ganzer, Chais, &

Olea, 2017).

The next aspect is the overall dimension this is performed transparently and the want for

sharing records associated with the dimension effects to the supplier. This is crucial as it has an

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1154 Return: Study of Economic And Business Management, Vol 2 (11), November 2023

effect on growing agree with and loyalty due to the fact there are overall performance measures

which are used as a reference for non-stop development of each quality, service, etc. wherein

this can have an effect on non-stop development of the connection among shoppers and

suppliers.

Top control help is crucial problem in a long-term courting method amongst customers

and carriers because it has an impact as true with and determination amongst the 2 activities,

the volume of and reality that activities are real and function a responsible determination in

building a courting method for supplier.

The sourcing approach aspect is crucial aspect. This aspect is associated with the dealer

evaluation and qualification system wherein this system establishes the minimal necessities for

providers for you to deliver uncooked substances. Suppliers who've the standards launched are

providers who can deliver uncooked substances due to the fact they may be blanketed as a

seller listing at the buyer's side after passing the seller evaluation degree. Then continue to the

dealer qualification degree wherein the outcomes of the dealer qualification system can be used

as a connection with decide the primary desire of providers to deliver uncooked substances

according with the mounted standards, in order that that is aspect constructing long-time

cooperative relationships between customers and providers each from deliver and demand,

price, excellent and such as deliver reliability.

CONCLUSION

Based on this qualitative research process, it can be concluded that there are 10 factors

that contribute to the courting technique amongst buyers and carriers to ensure deliver of

uncooked materials which in the long run contribute to the company's industrial average overall

performance, particularly cause factors, determination and responsibility factors, agree with and

reputation factors, interpersonal courting factors, verbal exchange and facts sharing factors,

settlement factors, fine and versatility factors, average overall performance appraisal factors,

manage resource factors and technique sourcing factors.

The insurance and managerial implications which can be generated are that it is hoped

that this research can provide input, mainly for the Pharmaceutical Industry as a patron and

moreover a issuer to enforce comprehensively and comprehensively the factors that contribute

to the method of long-term cooperative relationships simply so on the identical time beneficial

partnerships are constructed for occasions.

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