Vendor development and control:its linkage with demand chain

Abstract

Explains the linkage of vendor development and control as an integral factor of value on demand chain logistics. Presents a comparison of the traditional purchasing function with vendor development in. Provides the missing link of value chain by demand chain. Describes the supplier integration approach as a competitive corporate strategy in a conceptual synthesis by linking demand chain with order management, marketing, sales, channel management, pricing, service, etc. Analyses the vendor development strategy from three key dimensions. Further discusses the advantages of vendor development in the short run, bottom line performance increase, and long run revenue enhancing the value of an organisation. Also discusses the impact on demand chain from the costing point of view with elaboration on cost and pricing activities involving total cost of ownership, understanding supplier costs and target costing with target pricing commensurate with expectations of customers. Concludes with an emphasis on the importance of providing e‐learning and upgrading the skills of staff in order to expedite the adoption of vendor integration strategy in its demand chain logistics management.

Citation

Seetharaman, A., Khatibi, A.A. and Swee Ting, W. (2004), "Vendor development and control:its linkage with demand chain", International Journal of Physical Distribution & Logistics Management, Vol. 34 No. 3/4, pp. 269-285. https://doi.org/10.1108/09600030410533583