The impact of market orientation on Chinese retailers' channel relationships

Abstract

Purpose: This study seeks to examine the influence of market orientation on Chinese buyer-supplier relations. A model is proposed depicting relationships among retailer market orientation, supplier market intelligence, supplier role performance, and retailer economic and social satisfaction. Design/methodology/approach: Data were collected from 99 chain store buyers and managers from 25 cities in China. Structural equation modeling was used to analyze the data. Findings: A retailer's market orientation is critical for its own economic and social satisfaction by increasing supplier market intelligence (MI) and supplier role performance. Practical implications: Retailers' MO increased supplier MI and role performance. This study found that economic performance was more important in channel relationships than social relationships. Therefore, suppliers should focus on improving retailers' economic satisfaction through role performance and market intelligence rather than social satisfaction. Originality/value: Previous MO literature has focused primarily on the firm's performance and ignored the interactive aspect of business performance among channel members. The current study fills this gap by demonstrating the significant influences of retailer MO on supplier MI and on supplier role performance, as well as on retailer satisfaction - both the economic and social components. To the authors' knowledge, the current study is the first to relate retailer MO, supplier MI, and supplier role performance to two types of retailer satisfaction - i.e. economic and social satisfaction. © Emerald Group Publishing Limited.