Don’t all firms have relationships?

The need for suppliers to carefully determine the form of customer relationship which is appropriate for their business is discussed. The experiences of two firms are considered, one of which is successful because it does not develop close relationships with its customers or its suppliers. The other each year applies a sophisticated classification scheme to determine what type of relationship will be most profitable. It makes this assessment on the basis of its understanding of each customer’s needs and of the resources it has available to manage whatever types of relationship it considers appropriate.