Managing Channel Relations in China: An Exploratory Study

Channel management deals with the establishment of an efficient and effective distribution channel. It implies the stepwise development of channel leadership and channel relations. International channel management and the establishment of cross-border relations between exporting suppliers and their foreign subsidiaries and intermediaries are key in international marketing performance (Madsen, 1989; Cavusgil & Zou, 1994; Solberg & Nes, 2002). Li (2003) proves that an export channel is a very complicated phenomenon and a number of factors, both contextual and historical, affect simultaneously the exchange modes and their operation. However, managing channel relations is ‘people business’. Crossing borders implies therefore being confronted with different cultural expectations vis-a-vis the role and behavior of the ‘ideal’ channel leader. Also, the effectiveness of certain channel management practices might be undermined or reduced. The impact of culture cannot be underestimated when it concerns distribution, as is amply demonstrated with the difficulties of Western companies in Japan (Usunier, 2000). Also Rosenbloom and Larsen (2003) have proven how cultural distance (high versus low-context culture) impacts on