Examining perceived value for money, relationship commitment and re-buying intention in a business-to-business context -a suggested model

Value for money has been seen as an important construct in recent years, but most of the research that has examined this construct has been undertaken in business-to-consumer contexts and very little is known about its role in business-to-business contexts. The current study developed and tested a model that explained the influence of some suggested antecedents (past satisfaction, perceived risk, product quality and service quality) had on perceived value for money and their subsequent impact on relationship commitment, customer loyalty and re-buying intention. Two of the antecedent variables (service quality and customer loyalty) were found to have discriminant validity problem and were excluded from a revised model. The results suggested past satisfaction, perceived risk and product quality all had significant influences on perceived value for money. However, Baron and Kennys (1986) mediation assessment procedure suggested perceived value for money was not a dominant mediator between these antecedent variables and commitment to the relationship. This led to the development of an alternative model in which perceived value for money was included as an exogenous construct that fitted the data better then the initially suggested model. The results also suggested switching costs moderated the relationship between commitment to the relationship and intention to re-buy, as commitment to the relationships impact on re-purchase intention was greater when switching costs were high. Switching costs also moderated the relationship between product quality and intention to re-buy, as, when switching costs were high, product quality had no direct effect. However, when switching costs were low, product quality had a strong direct positive effect.