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The paper presents results from a survey of 133 dairy producers in Malaysia, and identifies how Malaysian milk buyers can build a loyal customer base with their suppliers as a means to secure uninterrupted milk supplies. A structural equation model was conducted to test the conceptual model using AMOS 17.0 software. The results show that whereas timely and collaborative communication, price satisfaction and cultural fit influence positively suppliers’ contractual and competence trust in their buyers, power dependency negatively influences competence trust. Furthermore, suppliers’ trust in their buyers will eventually lead to loyalty. The principal implication is that milk processors and other buyers need to engage in collaborative communication with the dairy farmers to ensure continuous and uninterrupted supply.

Keywords: dairy ; Malaysia ; customer base ; competence trust ; suppliers trust ; collaborative communication

Subject(s): Agribusiness

Agricultural and Food Policy

Farm Management

Industrial Organization

Institutional and Behavioral Economics


Research and Development/Tech Change/Emerging Technologies

Research Methods/ Statistical Methods


Issue Date: 2010

Publication Type: Journal Article

DOI and Other Identifiers: 1442-6951 (Other)

PURL Identifier: Published in: Australasian Agribusiness Review, Volume 18 Page range: 66-84

Total Pages: 19

Series Statement: Volume 18

Paper 5

Record appears in: University of Melbourne > Melbourne School of Land and Environment > Australasian Agribusiness Review

Autor: Boniface, Bonaventure ; Gyau, Amos ; Stringer, Randy ; Umberger, Wendy J.


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