Key Factors Affecting Positional Advantage of Export Partnerships
Hanmo Oh, Byeong-Joon Moon
Current economic trends have provided incentives for firms to explore the global competitive landscape, and export-ventures are one of the strategies for developing successful international marketing networks, especially when a firm’s resources are limited. Although research suggests that export-ventures are valuable tools for improving performance in the global marketplace, the establishment of such ventures does not automatically guarantee positive results. Export-venture long-term success depends on the development of close partnerships. Despite this importance, few studies have tried to explain export partnership success.
This study represents an attempt to understand the key factors that influence export-venture success. The central thesis of this study is that both exporters and export intermediaries play important roles in developing positional advantages for export-ventures. Using resource-advantage theory of competition as an underlying framework, a model is developed that draws on the relationship marketing theory, alliance theory, and international marketing theory to explain export-venture performance. Five basic categories of resources are posited to influence export-venture positional advantage: exporter-specific resources (e.g., manufacturing capability, brand awareness), export intermediary-specific resources (e.g., export market knowledge, export market experience, relationship building capabilities), partnership-related resources (e.g., partnering experience, the number of partnership-dedicated personnel), relationship-enhancing factors (e.g., interfirm communication quality, role clarity), and relationship-destroying factors (e.g., opportunism, conflict). Finally, an export-venture’s positional advantage is posited as influencing its superior financial performance.
Export-ventures, who are more effective, realize increased levels of customer satisfaction and enhanced customer loyalty. These positive outcomes enable export-ventures to charge premium prices, increase market share, and, in turn, improve their financial performances. Therefore, it is posited that: P1: Export-venture positional advantage is positively related to export-venture financial performance.
Research suggests that a manufacturing capability improves a firm’s marketplace position. For example, one aspect of a manufacturing capability is efficiency, an important characteristic of marketplace position. Therefore, it is posited that: P2: Manufacturing capability is positively related to export-venture positional advantage.
Brand awareness is linked to factors that enable export-ventures to reduce costs and deliver more value to consumers. The rise of global competition has only increased the importance of brand awareness. Therefore, it is posited that: P3: Brand awareness is positively related to export-venture positional advantage.
By sharing export market knowledge, about customers and competitors, an intermediary provides an export firm with insights regarding value-adding activities the firm should undertake to match market conditions. Therefore, it is posited that: P4: Export market knowledge is positively related to export-venture positional advantage.
Intermediaries with substantial experience in export processes can use the accumulated knowledge from past decisions, actions, and errors to inform decision-makers of opportunities and threats. For example, intermediaries’ experience in a foreign market enables an export-venture to locate foreign customers efficiently. Therefore, it is posited that: P5: Export market experience is positively related to export-venture positional advantage.
An export intermediary’s relationship building capability enables the export-venture to also deliver more value. Moreover, an export intermediary’s capability of building strong supplier relationships ensures the consistent delivery of the proper level of customer service. Therefore, it is posited that: P6: Relationship building capability is positively related to export-venture positional advantage.
Partnering experience can help an export firm, as well as an export intermediary, develop adequate management routines and avoid mistakes during partnership development and maintenance stages. Consequently, firms with greater partnering experience make decisions that enable their ventures to be more efficient and more effective. Therefore, it is posited that: P7: Partnering experience is positively related to export-venture positional advantage.
The employees, who are responsible for interfirm relationships with export partners, are essential alliance managers. Alliance managers provide export firms with benefits, such as securing suitable intermediaries, minimizing the chance of conflict with partners, and working with intermediaries to successfully combine their complementary resources. Therefore, it is posited that: P8: Number of partnership-dedicated personnel is positively related to export venture positional advantage.
Because timeliness of information exchange enables partners to quickly understand changing situations in marketplaces, higher levels of communication quality enhance market intelligence and allow export-ventures to respond more quickly to competitive threats and marketplace changes than competitors. Therefore, it is posited that: P9: Interfirm communication quality is positively related to export-venture positional advantage.
Role clarity leads to higher levels of trust and commitment among partnerships and facilitates resource integration between partners. Thus, it facilitates the creation of value. Therefore it is posited that: P10: Role clarity is positively related to export-venture positional advantage
Opportunism can seriously harm the long-term potential of partnerships. Research suggests that opportunism is negatively impacts export-ventures’ marketplace positions. Opportunism impedes an export-venture’s abilities to deliver additional value and raises its costs. Therefore, it is posited that: P11: Opportunism is negatively related to export-venture positional advantage.
Higher levels of dysfunctional conflict retard a export-venture’s ability to deliver value. In addition, it increases costs. That is, it hinders the efficient combining of resources, which can lead to increased expenditures. Therefore, it is posited that: P12: Dysfunctional conflict is negatively related to export-venture positional advantage.
This study has scholarly implications. First, based on resource-advantage theory of competition, this study theoretically integrates the resource-based theory of the firm, the competence-based theory of the firm, dynamic capabilities theory, and relationship factors theory. By incorporating these theories, this study helps fill the need for development of export marketing theory. In particular, this study supports the premise that resource-advantage theory of competition provides a solid ground for export-venture success. Second, this study supports the competence-based theory of alliance success in the context of export partnerships. That is, the study suggests that two dimensions of alliance competence (e.g., partnering experience, the number of partnership-dedicated personnel) enable firms to combine resources. Third, this study contributes to the relationship marketing literature. Specifically, the study illustrates that both relationship-enhancing and relationship-destroying factors affect export-ventures’ positional advantage. The understanding of this issue is invaluable because there has been little research that simultaneously considers the two types of interfirm relationship factors.
This study also has important implications for marketing managers. First, the study points out the importance of export intermediaries’ knowledge and experience. If partners possess complementary knowledge and experience, the partnership is able to leverage performance differences, create synergies, and, thereby, gain a competitive advantage in the marketplace. Second, the study posits that relationship building capability has a positive effect on an export-venture marketplace position and that firms should identify an export intermediary as part of the firm’s relationship marketing strategy.
Keywords: Export-venture, Resource-advantage theory, Export intermediary-specific resources, Positional advantage, Export partnerships
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