Suppliers’ Control over Category Management in Finnish and Swedish Supplier–Retailer Relationships

Abstract

The present study analyses suppliers’ control over category management (CM) in Finnish and Swedish supplier–retailer relationships. The study addresses: (i) the suppliers’ ability to control the tactics of CM; and (ii) the origins of this control. Based on the literature on CM and sources of power, a four-page self-administered questionnaire is used to conduct a quantitative survey among 90 Finnish and 116 Swedish representatives of suppliers of fast-moving consumer goods. The study reveals that both Finnish and Swedish suppliers believe that retailers are clearly in charge of CM tactics; however, large suppliers are perceived to have some control over CM decision-making in both countries. Suppliers apparently have most influence over in-store promotions and least influence over pricing. In the Finnish context, the extent of power seems to be dependent on the market position of a given supplier, whereas in the Swedish context the suppliers’ market position did not seem to affect the extent of control. According to both Finnish and Swedish suppliers, the most important origins of control over CM tactics were non-coercive in nature—that is, they were based on referent power and expert power. The study suggests that suppliers who wish to gain some control over CM tactics should base their interaction with retailers on expertise and issues related to referent power bases.