What breaks trust in customer supplier relationship?

The purpose of this paper is to understand what breaks trust in a customer supplier relationship and how to repair it.

The approach takes a single case study to test the established theories on trust. It captures the circumstances and conditions of everyday situation in business and it is a longitudinal study covering three years' experience of two organisations in business.

The important findings of this case study are that knowledge, level of risk and level of risk tolerance of customers/suppliers are the main causes of trust break down. Though the research on trust focus on partner's characteristics such as benevolence, honesty, reliability, credibility, integrity, contracts, agreements etc., in the context of B2B relationship these perspectives can only help the partners in evaluating the other partner as trust worthy. Once the partners engage in the relationship the orientation will change towards perspectives of rational risk. If the risk level exceeds their bearable limits, trust will break. Trust repair depends on the convincing power of the trustees, and how and why the trustor should bear the uncertainty or risk involved in the relationship.

With its focus on two business partners this case cannot be generalised to all business settings. However, the in‐depth analysis stimulates further research on how trust may break between partners and how and who (trustor/trustee) should initiate trust repair process.

Practicing managers and research scholars can use this case in trust building process in customer supplier relationship.

The paper presents a case that is original.