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Methodological approach to transaction attractiveness valuation as a decision-making tool of organisational strategy

Hanna Shvindina and Viktoriya Martynets

International Journal of Management and Network Economics, 2018, vol. 4, issue 2, 159-176

Abstract: The aim of this paper is to make contractual decisions visible for transaction cost analysis, and to formulate an applicable approach to evaluating decisions about distribution contracts. The term 'transaction attractiveness' is offered by the authors as a general criterion of choice. The authors offer a framework for the analysis of transaction attractiveness on the basis of evaluation of the return on transaction costs (ROTC) index. The transaction attractiveness method includes the evaluation of the indexes of transaction costs, the indexes of general financial performance, and ROTC index. The methodology presented in the paper is based on a generalisation of the ideas about the transactions and transaction costs of the firm and specified for the accounting system of Ukraine (Western Europe). The factual implementation of the framework was provided at the Ukrainian enterprise and positively affected decisions of the distribution systems.

Keywords: direct channels; distribution; decision-making process; transaction costs; transaction characteristics; transactional attractiveness; return on transaction costs; ROTC; management. (search for similar items in EconPapers)
Date: 2018
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Handle: RePEc:ids:ijmnec:v:4:y:2018:i:2:p:159-176