Fairness-Trust-Loyalty Relationship Under Varying Conditions of Supplier-Buyer Interdependence

Abstract

Relationship marketing plays a significant role in supply chain practice and academic studies. Using the resource advantage theory within the relationship marketing framework, we studied the mediating role of trust as a governance mechanism in the fairness-loyalty relationship under different types of interdependence structure between suppliers (wholesalers) and buyers (retailers). Our findings, based on data from retail pharmacies, demonstrate that only under conditions of symmetric independence, trust, as a governance mechanism, completely mediate the relationship between fairness and loyalty. Under conditions of both perceived independence (i.e., lack of interdependence) and asymmetric buyer dependence, however, trust does not mediate but fairness directly influences loyalty. Thus, fairness and trust influence loyalty, strengthening relationships in different ways under different conditions of interdependence. The implications for research and practice are discussed.