Role of Buyer-Supplier Relationship on Buying Firm’s Performance in Chemical Sector of Pakistan

Abstract

This research paper aims at proving the importance of buyer-supplier relationship for the enhancement of the performance of the customer firm. The six companies that have been focused belong to the listed chemical sector in KSE 100 index. The Buyer-Supplier Relationship (measured through seven factors including Frequency of Communication, etc.) has been taken as independent variable where as buyer’s performance (measured through financial indicators like ROA and ROE) has been taken as dependent one. The data used has been collected through questionnaires as well as from the annual reports of the companies under study. Descriptive statistics, Pearson’s Correlation and Ordinary Least Squares (OLS) method has been used to analyze the data. Results reveal positive as well as negative correlation between some of the factors. The regression results are unrealistic due to the fault in data collected through questionnaire. Also some recommendations have been made to help buyers develop their relationships with the suppliers.

Keywords: Buyer-Supplier Relationship, Buyer’s Performance. Chemical Sector