Price satisfaction and producer loyalty: The role of mediators in business to business relationships in Kenyan mango supply chain uri icon

abstract

  • Purpose - The purpose of this paper is to investigate which dimensions of price satisfaction influenceproducers' trust in buyers and assess the mediating role of such trust in the relationship between pricesatisfaction and producer loyalty in fresh fruit supply chains.Design/methodology/approach - A cross-sectional study design using both semi-structuredinterviews and structured questionnaires was used. The study was conducted in the Eastern part ofKenya and included 600 smallholders. Data were analysed using structural equation modelling.Findings - The results show that price fairness, price reliability, and relative price are dimensions ofprice satisfaction that affect producers' trust in the buyer. Moreover, trust between the producer andthe buyer is found to be a strong mediator between price satisfaction and producer loyalty.The findings support recent studies about trust and its mediating role.Research limitations/implications - The paper is based on a cross-sectional study design, limitingthe causal inferences which can be drawn. Producers' preferences change with time and future studiesshould be based on longitudinal designs.Originality/value - This paper shows the relationship between the multi-dimensional nature of pricesatisfaction and producer loyalty with trust as a mediating variable in the business-to-business (B2B)context. Although B2B relationships have been shown to be of great importance for smallholders inenhancing business performance with their buyers, little attention has been given to the role of trust asa mediator. This study offers interesting insights into the how trust plays a mediating role betweenprice satisfaction and loyalty in a developing country context

publication date

  • 2016
  • 2016