Customer attractiveness, supplier satisfaction and preferred customer status: a review and a cycle model

Abstract

In this paper, we introduce the concept of preferred customer status, i.e. a buyer is awarded preferential treatment of its important suppliers compared to their other customers. As there is a lack of knowledge of what motivates suppliers to serve selected buyers better than others, our research focuses on the suppliers’ evaluation of customers and how it can be influenced by buyers. Based on social exchange theory, we provide a conceptual model which proposes customer attractiveness, supplier satisfaction and knowledge of alternative customers as factors influencing suppliers to award preferred customer status. Subsequently, a literature review is provided to give an overview of the drivers of customer attractiveness, supplier satisfaction and preferred customer status already analysed in current literature. We conclude by providing a preliminary conceptual framework and suggesting future research directions in this field. This article proposes new insights into supplier relationship management and offers a state-of-the-art analysis as well as a theoretical base to this new research field