Competitive effects of co‐operation with suppliers and buyers in the sawmill industry

Abstract

PurposeThe present paper proposes simultaneous research into the effects of co‐operation with buyers and suppliers on company performance, and how both types of co‐operation interact in one specific industry.Design/methodology/approachThe paper conducts an analysis of a sample of 80 sawmills in the Spanish regions of Galicia and the Basque Country, comprising most of the wood production in Spain.FindingsContrary to prior research, the results suggest that contextual factors, inherent to each supply chain, affect the relationship between supplier‐customer co‐operation and performance.Research limitations/implicationsThe findings lead one to argue that some traditional arguments in favour of co‐operation with buyers and suppliers might not be applicable to specific industries, positions in the value chain or exchanged products, and that industry‐specific variables should be included in future research.Practical implicationsSawmills appear to benefit only from co‐operation with buyers, but not from co‐operation with suppliers. Furthermore, the two types of co‐operation do not appear to generate synergy.Originality/valueThe study adopts a systemic view of the supply chain and argues that industry‐specific factors, and position in the value chain, should be included as control variables in empirical work researching the competitive consequences of co‐operation in the value chain.