In the business market, prices are typically subject to negotiation between exchange partners and buyers’ perceptions of the relationships with suppliers have a central role for supplier success and for establishing profitable prices (Hinterhuber & Liozu, 2015). Suppliers that seek to achieve price levels above the average market prices of offerings need to convince buyers of a favorable price/quality ratio (Töytäri, Rajala, & Alejandro, 2015). To date, however, research on absolute prices paid by buyers to suppliers, relative prices paid as compared to the average price level in a product category, or exchange partners’ perceptions of prices charged in business relationships remains limited. Extant work on buyer-supplier relationships has most commonly focused on costs rather than prices as economic outcomes of interest (e.g., Cannon & Homburg, 2001; Kalwani & Narayandas, 1995). The purpose of this research is to deepen the understanding of buyers’ price assessments in business relationships. Specifically, this research seeks to further illuminate how relationship inputs provided by suppliers influence buyers’ assessments of the price level charged and their satisfaction with the price/quality ratio provided by the suppliers. The relationship inputs examined include buyers’ perceptions of supplier relationship-specific investments, long-term orientation, and relationship planning. In addition, this research considers two relationship parameters, that is, buyers’ commitment to the supplier and dependence from the supplier. Based on a sample of executives of different buyer firms, this research examines net effects and combinatory effects of the relationship factors on buyers’ evaluations of economic outlay. While the study of net effects offers insights into the effects of single antecedents on the outcomes across a sample of cases, the analysis of combinatory effects delineates (configurations of) antecedents sufficient for bringing about the outcomes of interest (e.g., Leischnig, Henneberg, & Thornton, 2016). Knowledge of these effects helps assess what relationship inputs and what combinations thereof may act as potential remedies for buyers’ price-related resentment in business The findings of this research show alternative configurations of relationship inputs and relationship characteristics sufficient for the two outcomes of interest. In addition, this research shows that individual relationship inputs and characteristics can have opposite effects on the outcomes, depending on how they combine with other antecedent conditions. Moreover, the results of this research reveal that specific antecedent factors differ in terms of causal coreness for the two outcomes of interest. In summary, these findings add to the net effect analysis and provide a more detailed and nuanced understanding of how relationship attributes impact buyers’ price assessments in business relationships.

In an increasingly dynamic business environment, innovation output occupies a central position among all organizational outputs, not only because it is a primary way in which firms compete and grow, but also because it profoundly influences social and economic evolution (Eisenhardt & Tabrizi, 1995; Sorensen & Stuart, 2000). Understanding the factors that determine an organization’s ability to produce new ideas and continually innovate thus is a fundamental issue in strategic management and marketing fields. Among all sort of determinants, collaboration with buyers to create value through innovation has attracted particular attention from scholars (von Hippel, 1988; Thomke & von Hippel, 2002; Sawhney, Verona, & Prandelli, 2005). This study examined the role of Internet-based collaboration in the buyer-supplier relationship in promoting product innovation of supplying firms. Drawing on the juxtaposition of the governance literature and social exchange theory, we proposed that Internet-based collaboration positively affects product innovation performance of supplying firms, but too much dependence on it impedes product innovation. That is, Internet-based collaboration has an inverted U-shaped relationship with product innovation performance of supplying firms. It further posited that in-person interaction between buying and supplying firms strengthens the positive effect of Internet-based collaboration on product innovation, such that when the degree of in-person interaction is high, Internet-based collaboration is associated with better innovation performance. These propositions were tested using data from a large survey conducted by a survey data on buyer-supplier relationships in China. The results show that Internet-based collaboration has a stronger positive relationship with innovation performance and this positive effect declines after the degree of Internet-based collaboration goes beyond a threshold. Moreover, the first-order effect of Internet-based collaboration is stronger when the degree of in-person interaction is high than when it is low. The optimal level of Internet-based collaboration in low degree of in-person interaction is moderate, whereas when in-person interaction is more frequently used in connecting with buying firms the optimal level rises. These results provide strong supports for the predictions of hypotheses.