A Study of the Role of Guanxi in Sino-Japanese Distribution Channel Relationships in China

Abstract

Among the many strategies of marketing in China, the traditional business practice guanxi is perceived as a major instrument for success of foreign corporations. This thesis focuses on how and whether guanxi functions in Sino-Japanese distribution channels. The thesis built on an approach by LaBahm & Harich (1997), who have proposed the concept of sensitivity to foreign culture in the study of US-Mexican channel relationships. This thesis adapted this model for the study of Sino-Japanese business relationships to examine the role of guanxi in distribution channels. Hypotheses were tested through a quantitative survey of forty-eight Japanese manufacturers in China. The results of the quantitative study were complemented with data collected during five in-depth interviews with Japanese corporations in China and Japan. Besides, this thesis also provides implications for Japanese management in China in regard to guanxi, historical issues, language, and agreements. In conclusion, this study has lead to a better understanding of issues of communication, conflict, and relationship performance in Sino-Japanese channel relationships, and especially of the role that guanxi is playing in the distribution channels.