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Business Relationship Framework in Emerging Market: A Preliminary Study in Indonesia

Author

Listed:
  • Anton A Setyawan
  • Basu Swastha Dharmmesta
  • B.M Purwanto
  • Sahid Susilo Nugroho

Abstract

This paper explores business relationship framework between two companies. In this research, we use relationship marketing and transaction cost as frameworks to analyze business relationship of two different kinds of companies in Indonesia, oil company and hypermarket. Gronroos (1994) defines relationship marketing is establishing, maintaining, and enhancing relationships with customers and other partners, at a profit, so that the objectives of the parties involved are met. This is achieved by a mutual exchange and fulfilment of promises. This definition is a key to analyze the relationship of retailer and their supplier. In the other side, Williamson (1980) argued that relationship in business organization based on their economic interest. This approach known as transaction cost approach. In this kind of relationship, business organizations consider cost and benefit of business relationship. We use qualitative method in this research. The design of the research is case study with multiple cases proposed by Yin (1994). In this case study, we use basic content analysis as tool to analyze the phenomenon. Unit analysis of this research is company. We use two cases in the different companies, Oil Company and hypermarket. In order to gain validity, we use multiple key person or informant to gain validity. The result shows, that in the oil company, relationship between company and their supplier tied on a strict contract. In fact, the relationship of supplier and a company is based on transaction cost theory. In the hypermarket company, the relationship of supplier and retailer is based on trust, commitment and satisfaction. Those three construct are the foundation of relationship marketing.

Suggested Citation

  • Anton A Setyawan & Basu Swastha Dharmmesta & B.M Purwanto & Sahid Susilo Nugroho, 2014. "Business Relationship Framework in Emerging Market: A Preliminary Study in Indonesia," International Journal of Economics & Business Administration (IJEBA), International Journal of Economics & Business Administration (IJEBA), vol. 0(1), pages 59-72.
  • Handle: RePEc:ers:ijebaa:v:ii:y:2014:i:1:p:59-72
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    References listed on IDEAS

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    1. Philippe Bertrand & Pierre-Xavier Meschi, 2005. "A Transactional Analysis of Chinese Partners' Performance in International Joint Ventures," Chinese Economy, Taylor & Francis Journals, vol. 38(2), pages 16-35, March.
    2. Michèle Paulin & R.J. Ferguson & Marielle Audrey Payaud, 2000. "Business effectiveness & professional service personnel : relational or transactional managers ?," Post-Print halshs-00650017, HAL.
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    Cited by:

    1. Almas Kuralbayev & Nurjan Abishov & Aizhan Abishova & Gulnara Urazbayeva, 2017. "The Measurement of the Spiritual Tourism in Regions of South Kazakhstan," European Research Studies Journal, European Research Studies Journal, vol. 0(3A), pages 115-133.
    2. Meutia Tubagus Ismail & Ahmad Bukhori, 2017. "The Role of Feedback and Feed Forward Control System to Improve Competitive Advantage of SMEs in Indonesia," European Research Studies Journal, European Research Studies Journal, vol. 0(2A), pages 496-506.
    3. Mikhail Nikolaevich Pavlenkov & Valeryi Glebovich Larionov & Pavel Mikhaylovich Voronin & Ivan Mikhaylovich Pavlenkov, 2017. "Enterprise Development Factors’ Control," European Research Studies Journal, European Research Studies Journal, vol. 0(2A), pages 581-591.
    4. Agus Zainul Arifin, 2017. "The Influence of Financial Knowledge, Control and Income on Individual Financial Behavior," European Research Studies Journal, European Research Studies Journal, vol. 0(3A), pages 635-648.

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    More about this item

    Keywords

    Relationship Marketing; Resource Dependence; Transaction Cost Theory; Multiple Case Studies;
    All these keywords.

    JEL classification:

    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility
    • M31 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Marketing and Advertising - - - Marketing
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives

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