The Influence of Internal and External factors on the Supplier Selection: A study in the Swedish Furniture Industry (Management Project)

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Sweden has a global reputation of producing exquisite and functional furniture, and the Swedish industrial design is internationally well-known. The supply of materials is necessary in every company and purchasing is responsible for coordinating and organising the supply. The materials purchased from vendors become one of the most strategic parts of the final product quality in order to reduce complaints and additional costs generated by low quality of materials.

Supplier selection plays a vital role in any company as it represents a significant production of the unity prices as well as enhances organisational price competitiveness. It is essential for companies in the furniture industry and from other industries to take into consideration the internal and external organisational factors that reflect on the supplier selection process to
remain competitive and to gain competitiveness before choosing potential vendors.

The purpose of this study is to analyse how the internal and external organisational factors are reflected in the supplier selection criteria in the Swedish Furniture Industry. The combination of the two theories in the frame of reference, namely supplier selection process as well as internal and external organisational factors were utilised in order to accomplish this purpose.

This paper is based on the use of a multiple-case study, including six organisations or cases. The type of interview relevant for this research is the “unstructured interviews” as they are informal and are used to explore in depth a general area in which the researchers are interested, also referred as “in-depth interviews”.

One of the main outcomes found after analysing the theoretical framework and the gathered data is that quality and delivery time are heading these companies’ ranking lists affecting directly their supplier selection. Another outcome verified by the researchers of this paper is the fact that the case study companies present a decentralised approach where the purchasing departments have a total independence with regard to day-to-day supplier selection decisions.

A third outcome found is that the case companies are collaborating with both national and international suppliers where all the relevant international vendors are located in Europe as companies are prioritising geographical location of their suppliers. The final outcome highlighted is the fact that economic factors do not have a relevant influence on supplier selection decisions, as it was found out in the conduction of this research.
Source: Jönköping University
Author: Adilson, Leite Cancino | Chatzidakis, Nikolaos

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