Improving Vendor-distributor Relationships of an ICT Case Distributor with Vendor X

Abstract

The aim of this thesis is to firstly, give reasons as to why vendor relationship man-agement with vendor X is important to the development of procurement and, in the long term, the sustainability of growth at the case company, an ICT case distribu-tor. Secondly the thesis introduces a theory framework and aims to establish a vendor relationship management system.

In this thesis, a theoretical framework linked to the procurement maturity model and the stage of supplier integration supports the evaluation of the current situa-tion at the case company. Information on the distributor business model and ven-dor relationships in distribution provides insights into distribution, the industry that the case company is working in. The SAME (Select-Align-Measure-Exchange) framework, product portfolio and CMROWC (contribution margin return on working capitals) theories provide guidelines for the case company to establish and pursue long-term relationships with vendors.

The thesis is based on qualitative methods. Data was collected by interviews with three interviewees at the case company and secondary data included books, re-ports and the author’s observation during an internship period.

The findings indicate that the current procurement at the case company is be-tween “cost driven” and “integration” models, the company is in the “broadline” distributor segment and its relationship with vendor X is between “Going steady” and “Living together”. Based on the theory of the SAME framework, the product portfolio and CMROWC, recommendations are given to develop the current situa-tion.