Is guanxi important in a buyer-supplier relationship? case of Chinese logistics industry

Author Affiliation

Abdullah Zafar Sheikh is Associate Professor at the Institute of Business Administration (IBA), Karachi.

Faculty / School

Faculty of Business Administration (FBA)

Department

Department of Management

Was this content written or created while at IBA?

Yes

Document Type

Article

Source Publication

Journal of Asia Business Studies

ISSN

1558-7894

Disciplines

Accounting | Business | Econometrics | Economics | Finance

Abstract

Purpose: The purpose of this paper is to unveil negative outcomes associated with an absence of guanxi in a buyer–supplier relationship in Chinese logistics industry. Design/methodology/approach: This study uses a case study methodology using 16 semi-structured interviews with managers engaged in the process of buying and selling logistics services in China. Findings: Based on the qualitative interviews, managers experience lack of trust, lack of communication flow and reduced business volume when guanxi is absent in a buyer–supplier relationship in the Chinese logistics industry. Research limitations/implications: This study has some limitations. First, the results of this study are not generalizable to a broader population. Second, this study explores behavioral patterns with respect to Chinese business culture only. Practical implications: Firms can use the findings from this study to understand the consequence they can face when guanxi is absent in a buyer–supplier relationship. Originality/value: This study attempts to offer a balanced perspective on the role of guanxi in a buyer–supplier relationship, particularly in the Chinese logistics industry, by considering how an absence of guanxi generates negative outcomes for firms.

Indexing Information

HJRS - X Category, Scopus, Web of Science - Emerging Sources Citation Index (ESCI)

Publication Status

Published

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