STRATEGIC IMPACT OF SUPPLIER NEGOTIATIONS ON COST-TO-SALES RATIO AND TRADING TERMS
Manny A. Obaob
Cebu Technological University, Cebu City, Philippines
Abstract
This study examined the strategic impact of supplier negotiations on the cost-to-sales ratio (CTSR) and Trading Term Agreements (TTAs) of a retail supermarket chain base in Cebu. The study employed a descriptive–correlational research design, utilizing a validated survey instrument administered to 50 respondents involved in procurement, operations, and supplier coordination. Descriptive statistics and Pearson’s r correlation were used to analyze negotiation practices, CTSR performance, and TTA quality. Findings revealed that negotiation indicators were rated “Very High,” demonstrating strong execution of pricing, logistics coordination, relationship management, and contract oversight. CTSR was also assessed as “Very High,” reflecting efficient cost structures and financial performance. TTAs indicated strong delivery management and contractual obligations, although financial and credit terms showed room for improvement. Correlation results indicated strong to very strong positive relationships between negotiation strategies and CTSR (r = .81), and between CTSR and TTAs (r = .77), confirming that effective negotiations significantly enhance financial efficiency and support favorable trading terms. The study concludes that structured, data-driven, and relational negotiation practices directly improve procurement performance and contractual outcomes. In response, a Supplier Negotiation Improvement Plan (SNIP) was developed, offering a strategic framework for standardizing negotiation processes, strengthening supplier collaboration, enhancing contract compliance, and supporting financial optimization. The study contributes meaningful insights to retail procurement practice and provides actionable strategies for improving negotiation effectiveness within mid-sized retail environments.
Keywords: Supplier Negotiations; Cost-to-Sales Ratio (CTSR); Trading Term Agreements (TTA); Pricing and Financial Terms; Logistics and Operations; Relationship Management; Contract Management; Supplier Negotiation Improvement Plan (SNIP)
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EPRA International Journal of Environmental Economics, Commerce and Educational Management
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Published on : 2025-11-27
| Vol | : | 12 |
| Issue | : | 11 |
| Month | : | November |
| Year | : | 2025 |