Factors causing the termination of the relationship with suppliers

Over the past few years, firms have given more importance to the purchase-related decisions to gain competitive edge. Although great emphasis is given to the selection process of suppliers, commercial partnership may be terminated at a future date. This study, based on data from 66 automotive firms, examines factors affecting buyers' decision on the termination of the relationship with suppliers in the automotive industry. The results indicate that buyers rate 'supplier's disinterest' as the most influential construct of problems, and among the 25 individual problems, 'supplier firm does not make product deliveries in agreed time' is rated as the most influential problem to end commercial partnership. In addition, 'competitive firm's attraction level' is the only determinant of the probability of working again with the former supplier at a future date. Implications of these findings are discussed and further research opportunities described.