Making the Right Supply Chain Decisions Introduction Effective supply chain management (SCM) requires coordination and collaboration among the various channel members including retailers, manufacturers, and other chain intermediaries. In the food supply chain, the gradual dominance of retailers creates different perceptions of what constitutes a working partnership. Recent food crises have created a demand for both retailers and manufacturers to strictly comply with food safety and quality regulations and advocate for the joint development of unique retail brand specifications (Fearne et al. 2001). In this study, we aim to shed light on the relations between trust, commitment and supply chain efficiency by focusing on the Greek food sector where the food supply chains have evolved considerably during the last decades. Specifically, the local food sector’s structure is bipolar; on the one hand, a few large companies dominate the market such as the multinationals (e.g. Nestlé, Carrefour) and on the other hand, there is a significant group of small and medium-sized firms that operate mostly in regional markets. In the Greek food retail market, there are about 294 retail chains and the leading food retail multiples in terms of sales are the multinational firms, i.e. Carrefour and A/B Vasilopoulos (Delhaize Le Lion). The total food retail market is estimated to be approximately 7.9 billion euros (2001). In food manufacturing, there are 1,036 companies with 4.2 employees on average. Over 80% of the This study examines the collaboration in the food supply chain focusing on two chain partners: the retailers and the manufacturers. The authors examine the impact of key factors on collaboration performance including trust and the duration of collaboration. This study compares and contrasts the perceptions by retailers and manufacturers on the role of supply chain management. It illustrates that different food supply chain partners perceive differently the key critical factors which lead to supply chain effectiveness and casts doubts on the viability of current collaboration efforts which aim to achieve mutual benefits across the entire supply chain. It shows that the effectiveness of collaboration, and thus the functioning of the food supply chain, is highly dependent on retailers’ initiative to build and foster trust with their partners. It also depends on manufacturers’ ability to fulfil a complex set of retailers’ requirements including physical distribution management, commitment to the partnership, and effective information management. Managerial implications are discussed particularly for small and medium sized companies and directions for future research are provided. Supply Chain Collaboration Between Retailers and Manufacturers: Do They Trust Each Other? 70 Supply Chain Forum An International Journal Vol. 7 - N°1 - 2006 www.supplychain-forum.com Ilias P. Vlachos Agricultural University of Athens ivlachos@aua.gr Michael Bourlakis Lecturer in Food Marketing, School of Agriculture, Food and Rural Development, University of Newcastle, M.A.Bourlakis@ncl.ac.uk Acknowledgements The authors wish to express their gratitude to two anonymous reviewers and the editor for their invaluable comments and suggestions. © Copyright Bordeaux Business School ISSN print 1625-8312 ISSN online1624-6039 An International Journal Supply Chain Forum