Research Article
A Study on the Determinants of Long-Term Orientation between Foreign Suppliers and Local Retailers in the Korean and Chinese Home Appliance Industries
Published: January 2002 · Vol. 31 No. 6 · pp. 1659-1679
Full Text
Abstract
This study focuses on identifying the variables that affect long-term orientation between foreign suppliers and local retailers in distribution channels in Korea and China. Variables extracted as influencing long-term orientation between suppliers and retailers included environmental uncertainty, reputation, transaction-specific assets, and satisfaction, and a model was constructed in which these variables affect long-term orientation through the degree of dependence on the counterpart and trust. For the empirical analysis, data were collected from a total of 293 home electronics retailers located in Beijing, China, and Seoul, South Korea. The collected data were first analyzed separately for the Korean and Chinese cases to examine the relationships between variables. Then, the two countries' cases were compared and analyzed again to derive practical implications. In the analysis results for Chinese distribution channel members, most of the hypotheses proposed in the research model were supported. However, the relationships between environmental diversity and dependence, reputation and credibility, dependence and long-term orientation, and credibility and long-term orientation did not yield statistically significant conclusions. In Korean distribution channels, environmental variability and dependence, environmental diversity and dependence, transaction-specific assets and dependence, and reputation and credibility were found to be statistically insignificant, while the relationships among the remaining variables yielded statistically significant results. Finally, the study was concluded by examining practical applicability through discussion of the analysis results and presenting conclusions and limitations of the research.
