The Relationship between a Buyer Incentive Scheme and Purchasing Performance
Journal
當代會計
Journal Volume
13
Journal Issue
1
Pages
1-25
Date Issued
2012
Author(s)
Abstract
In this study, we investigate the appropriateness of an incentive scheme that links buyer compensation to the measurement of performance in a Taiwan retail chain. We use a Tobit regression model to examine the relationship between buyer bonus and purchasing performance, as well as assess the suitability of the current buyer incentive scheme in the case company. To improve scheme design, we have utilized the balanced scorecard (BSC) and analytic hierarchy process (AHP) to establish a more suitable performance measurement system to evaluate buyers. We found that there is no relationship between buyer bonus and purchasing performance. These results suggest that an incentive scheme that links compensation mainly to financial measures may not be suitable for motivating buyers. Our study fills a gap in the literature regarding the effects of incentives, as well as insights into a practical means for establishing appropriate incentive schemes for retail companies.
Type
journal article