The role of experiential foreign market knowledge and exporter-importer relationship quality on export performance satisfaction: empirical evidence from SMEs in Thailand

Abstract

Export performance has an important role for firm survival, profitability and growth. Given these benefits and the challenges that firms may face when exporting, scholars have dedicated considerable efforts to understand the factors that enable export success. The current study investigates the role of experiential foreign market knowledge and exporter-importer (EI) relationship quality for export performance. A conceptual model involving the relationship between the role of experiential foreign market knowledge, E-I relationship quality and export performance satisfaction is developed and empirically tested using data from 264 Thai exporting small and medium-sized enterprises (SMEs). Findings suggest SME managers’ knowledge of foreign customers, culture and political environment have a positive influence on E-I relationship quality and satisfaction with export performance. Drawing upon the relational exchange theory, goodwill trust was found to be the most significant aspect that builds long-term E-I relationship quality. Secondly, the findings show that calculative approach (e.g. commitment based on cost and benefits) is a mainstream type of commitment between exporters and importers. However, a personalised tie between the exchange partners has a positive influence on commitment, resulting in the affective commitment to E-I relationship. Thirdly, in a collaborative business partnership, decision-makers emphasise information exchange and coordinating actions for taking strategic decisions, which are informed by the feedback recived in their collaboration. In addition, the study finds that political instability negatively moderates the link of competence trust and information exchange on export performance satisfaction. Theoretical, managerial and policy implications of these findings are discussed and areas for future research are proposed.