Power-imbalanced relationships in the dyadic food chain: An empirical investigation of retailers’ commercial practices with suppliers

Abstract

Multiple retailers exercise various commercial practices with their suppliers. These practices emanate from a power-imbalanced dyadic relationship largely governed by the heightened retail power. These power-imbalanced, supplier-retailer relationships are the focus of this study. Drawing on the current literature of power-imbalanced relationships in supply chains, we propose and explore a conceptual model illustrating the most significant practices applied in the dyadic, supplier-retailer relationships in the Greek food chain and we evaluate their importance as perceived by suppliers. Insights from qualitative in-depth interviews with various stakeholders and a survey with 398 food suppliers identify dependence, financial goal incompatibility, informational asymmetry and behavioral uncertainty as the most significant determinants of the commercial practices. These practices are grouped into three main categories: upfront payments, unanticipated changes of agreements and negotiation pressures. The importance of these practices for suppliers is highlighted and implications for the supply chain actors beyond the dyad are provided. Significant managerial and policy implications are reported.