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The article investigates determinants of the number of suppliers that a firm has for a given product in its purchasing portfolio. Based on economic arguments we hypothesize that this number is negatively influenced by the degree of complexity of the purchasing situation and positively influenced by the financial importance of the product. The hypotheses derived from the theoretical model are tested empirically by using cross-sectional data. Results confirm the model. From a theoretical point of view, the study reveals that economic reasoning is suitable for predicting outcomes of industrial buying behavior. At the end of the article, the model is used as a basis for developing a purchasing portfolio.
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Homburg et al. (2001) studied this question.
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