The interacting effect of business and cultural distances on relationship management and export performance: the case of wine export between France and China

Abstract

Purpose This study aims to investigate the interacting effect of two forms of psychic distance (business and cultural) on export relationship management. Specifically, this research examines the moderating role of cultural distance in the effect of business distance on different dimensions of relationship management and financial export performance. Design/methodology/approach This research builds on a sample of 174 French export executives who were asked to rate their views of their relationship with their Chinese business counterpart in the wine trade, and their related performance. Findings A first finding lies in the strong positive effects of relationship management, relationship investment and communication quality on financial export performance. A second and important finding relates to the different effects of the business and cultural dimensions of psychic distance, while the former positively affects relationship management, the latter negatively moderates the effect of business distance on relationship management. Research limitations/implications One limitation pertains to the focus on France and China as the only countries involved in the current research. Future research could investigate whether the results replicate in different countries. Further studies would also be needed to enrich the relationship management dimensions and test whether the effects observed here replicate in relation to other dimensions. Practical implications For export managers, this research offers a better understanding of business and cultural distance, and their effects on relationship structuring. Specifically, the results indicate that cultural distance matters more than business distance, meaning that business distance can help relationship management only when cultural distance is low. In addition, the results indicate that wine producers might gain from communicating openly with their business counterparts, for instance, by clearly explaining the business objectives, or through continuous interactions and temporal and financial investments. Originality/value The originality of this research lies in identifying the interaction effect of the business and cultural dimensions of psychic distance, with cultural distance revealed as a boundary condition for the effects of business distance on relationship management. The inclusion of marketing and financial aspects constitutes a further original aspect.