Investigating the antecedents and outcomes of customer firm transaction cost savings in a supply chain relationship

Cost reduction has become a preeminent goal for businesses. Since firms spend a significant portion of their annual revenues on the acquisition of an array of goods and services from suppliers, organizational procurement has been identified as an area holding tremendous potential for the removal of nonvalue-adding costs. This effort examines how a vendor's order management cycle performance and trust can affect a customer firm's transaction costs, which in turn, affect such customer-related outcomes as customer satisfaction and future purchase intentions. The results are theoretically meaningful as they address gaps identified in previous writings and pragmatically useful as they offer managers practical insight into important bases for securing a competitive advantage. (c) 2005 Elsevier Inc. All rights reserved.